As further news and statistics on the newly discovered Omicron variant were being digested by traders Fed Chair Powell stirred up the markets further, by talking up faster tapering. Although early signs are the new variant is less severed markets remained risk averse preferring to wait for any news before looking to rally.

The S&P ended the week down 1%, its worst week since October 2020, while oil has dropped almost 25% since November 10th.

Australian Dollar was the worst performer, followed by New Zealand Dollar and then Sterling. Current developments suggest that for the near term, there will be more downside in stocks and more so in yield. Yen will likely to outshine the others.

Last week saw the us non-farm payrolls released. The headline print was way below forecast at +210,000 vs +550,000 expected.  However, the Unemployment Rate fell from 4.6% to 4.2% ,with an increase in the participation rate.  But this data will matter little to the FOMC when they meet in 2 weeks.

The week ahead sees RBA and BOC meet to discuss monetary policy. The RBA is expected to remain on hold after dropping the yield curve control program at the November meeting.  The BoC surprised markets at their October meeting by ending its QE program.. Although unlikely to raise rates at this meeting forward guidance will be key as traders look for clues how they will navigate inflationary pressures in 2022.