Persistent growth in job market to support the USD and Fed tightening:

The USD to trip up on support on Friday's NFP report. Average job creation of 150k or more during the next few employment reports should be consistent with a gradual increase in the fed funds rate.

NFP report is scheduled to be released on this Wednesday, we expect a creation of 225k jobs in December against consensus at 200k. Currently, fed funds price in only about 10bp for March and 50-60bp over the next year.

Data scheduled for this week likely to uphold further policy normalization: In conjunction to employment claims, ISM manufacturing would also be reported shortly, services and trade balance on Wednesday.

The consensus expects a slight improvement in manufacturing to 49.0 from 48.6 and services to 56 from 55.9, confirming the firm footing of domestic demand, despite global economic headwinds.

November factory orders (Wednesday) are expected to drop 0.2% m/m after a strong increase in November.

Finally, the minutes of the December 16 meeting will be released the same day. We do not think that there will be much more new information from that received in the press conference; therefore, the market effect should be limited.

Thus, we ponder the USD will outperform and the Fed will be comfortable delivering another 25bp hike in H1, followed by 50 bps of hikes additionally in H2 this year.