Italian Services PMI dipped to 49.4 in December from November’s 51.8, to signal a modest contraction in service sector output. Analysts were anticipating smaller decrease to 51.4. The headline index’s quarterly average was little-changed from the three months to September.

In the US session Non-Manufacturing PMI figures were released. US Non-Manufacturing PMI registered 56.2 percent in December, 3.1 percentage points lower than the November reading of 59.3 percent. Analysts were predicting smaller decrease to 58.2. This represents continued growth in the non-manufacturing sector. According to the NMI, 12 non-manufacturing industries reported growth in December. Comments from respondents are mostly positive about business conditions and the overall economy for year-end.

It will be quite eventful European part of the session tomorrow. From Germany Retail Sales and Unemployment Change data will be released. Analysts forecast 0.2% raise in Retail Sales and fall by 2,00 in number of unemployed. Also, Eurozone CPI and Unemployment Rate figures will be released. CPI is expected to show no change, that is to decline to 0.0% which would cause further downtrend in euro. Unemployment Rate should remain unchanged at 11.5%. In the US session ADP job figures, and Trade Balance data are scheduled for a release. ADP job figures should show increase of 227,000, while Trade Balance deficit is predicted to decline to $42.3 billion. However, the focus of the session will be on FOMC Meeting Minutes, which should bring a lot of volatility to the markets., and with traders looking for hints on future monetary policy.

Figures to watch:

German Retail Sales (Wednesday 8:00)

German Unemployment Change (Wednesday 9:55)

CPI/Core CPI (Wednesday 11:00)

Unemployment Rate (Wednesday 11:00)

ADP Non-Farm Employment Change (Wednesday 14:15)

Trade Balance (Wednesday 14:30)

FOMC Meeting Minute (Wednesday 20:00)