The focus for this week would be apart from the Fed meeting the main movers this week will be:

• US CPI (Tuesday)
• German ZEW (Tuesday)
• Euro Flash PMI (Wednesday)
• German Ifo (Thursday).

Focus would remain to be on the crude prices, China as well as the upcoming Fed decision on lift-off on Wednesday.

The PBoC proclaimed to launch a new barometer "CNY Exchange Rate Index" (CERI) which is a composite gauge of 13 major foreign currencies.

The CERI strengthened by 2.93% between January and November; therefore, China said that CNY is still a "strong currency" although the currency weakened by 4% against USD since August.

This is the first time that China announced an official trade weighted currency index. The central bank said that it would make more sense to reference CNY exchange rate to a basket of currencies, rather than the USD alone.

This is seen as a signal that China intends to weaken its currency especially against the USD, as the USD is likely to strengthen further as the Fed starts the interest rate normalization process soon.

In the past few months, Chinese authorities pledged that "there is no basis for CNY to continue to devalue, and China would keep the currency basically stable".

However, recent CNY depreciation versus USD makes the market confused about the meaning of "basically stable". The CERI could be used by Chinese authorities in the future as a new argument of "basically stable".

But end of the of the day, for many obvious reasons, markets will remain focused on that crucial event which is due for last 8 years, which is set to have a major impact on almost all asset classes. Yes, we believe fed's rate move is almost likely.

In particular, there is a well-documented concern over how emerging markets, where growth has slowed and USD-denominated debt has risen sharply, will cope with tighter US monetary policy.