he Republican controlled Congress now looks firmly on course to pass Donald Trump’s sweeping tax overhaul in the coming weeks. However, with year-end approaching, currency traders have appeared reluctant to take up large positions during the typically thin holiday trading.

News out of the major economies begins to wind down as we approach the winter holidays, with very few major economic data releases in the coming days. US housing starts and building permits data this afternoon is unlikely to rock the boat, with Dollar traders instead eyeing up Thursday’s revised GDP numbers.

Eurozone core inflation remains stuck below one percent

The Euro surged by as much as half a percent against the Dollar at one stage yesterday on broad USD weakness, although the currency did edge back below the 1.18 level yesterday evening.

Investors mostly overlooked the release of revised core inflation figures for November which continued to show that inflationary pressures remain subdued in the Euro-area. The core measure, which strips out volatile components such as energy, unexpectedly came in unrevised, remaining at a disappointing 0.9% year-on-year. With core price growth still stubbornly below 1% and not showing any meaningful signs of an uptrend, we see it as very unlikely that policymakers in the Eurozone will even consider raising interest rates until at least 2019 at the earliest.

Business confidence data from IFO this morning will be the only significant economic release of note in the Eurozone today. Other than that, this week bodes to be a fairly quiet one in the Eurozone with the common currency likely to be driven by events elsewhere.

Rand jumps after Ramaphosa wins ANC vote

Away from the major currencies, the South African Rand was the biggest mover of the day, jumping by over 4% against the greenback after deputy president Cyril Ramaphosa was elected the new leader of the ruling African National Congress. This will put heavy pressure on deeply unpopular President Jacob Zuma.

Meanwhile, Sterling was fairly range bound as markets opened for the week, edging only modestly higher versus the US Dollar in a day void of any significant market moving announcements. The Pound continued to receive some support from Friday’s news that the European Union had agreed to move Brexit discussions to the next stage. Brexit developments continue to dominate in the UK and macroeconomic news is expected to take a back seat as we approach year-end. Aside from a revision to third quarter GDP on Friday, there are no significant data releases on the docket in the UK this week.