SNB Rate Decision (07:30 GMT; 03:30 EST)
Consensus:         2.00%
Previous:             1.75%

Outlook:  The Swiss Nation Bank is heavily expected to raise its overnight cash rate by 25 basis points at its quarterly policy meeting. However, the ambiguity surrounding the data that has hit the wires since the September rate hike is clouding the potential for further rate hikes going into the new year. A key motive in doubting rate hikes in 2007 is the staid level of inflation.  The consumer price index has not breeched the central bankâ�,��"�s 2.0 percent target in years.  Furthermore, the annual measure has shrunk to 0.5 percent growth in November, the second slowest pace since April of 2004. Even SNB President Jean-Pierre Roth has said in a recent speech that price dynamism remains â�,��"very moderate.â�,�  Another detriment to further removal of monetary stimulus is the recent downturn in growth trends.  Third quarter economic growth eased to 2.4 percent, its slowest pace in a year.  Whatâ�,��"�s more, forecasts for the economy are soft.  The Leading Indicators index, used to forecast growth in the coming six months, has decelerated for five consecutive months. Given the questionable status of rate hikes deeper into the new year, policy makers will probably increase scrutiny over international trade and domestic consumer spending trends.  The trade surplus has held near highs in its most recent reads, but the looming VAT hike in Germany will likely suppress export demand.  Likewise, domestic spending is still strong, but a turn in employment and wage trends could quickly close the spigot.  Despite all of these questionable developments though, the market will most likely keep its hawkish bias as SNBâ�,��"�s Roth keeps pace with the ECB.

UK Retail Sales (NOV) (09:30 GMT; 05:30 EST)
                         (MoM)                    (YoY)
Consensus:         0.0%                     3.0%
Previous:             0.9%                     3.9%

Outlook: UK retail sales are anticipated to slow to a halt in November following a 0.9 percent surge the month prior. The November reading of CBI Distributive Trades indicated that spending on retail goods declined to the lowest level since March at a reading of -9. Meanwhile, expected sales for December declined to the lowest reading since August. The CBI data, along with surprisingly weak GfK consumer confidence results for the same month, does not bode well for sales ahead of the Christmas season.

Previous: Retail sales in the UK surged 0.9 percent in the month of October, bringing the annual rate to hit a 10-month high of 3.9 percent. Lower prices in stores, weaker gasoline costs, and a strong labor market led consumers to buy more in department stores and over the internet. The resilient housing market is also giving consumption a boost, as increasingly strong prices leave households with greater asset values and more confidence. The retail sales data backed the Bank of Englandâ�,��"�s claims that consumer spending will help to fuel economic growth.

US Import Price Index (NOV) (13:30 GMT; 08:30 EST)
                          (MoM)                    (YoY)
Consensus:          0.1%                      n/a
Previous:             -2.0%                    -0.2%

Outlook:  The sharp drop in import inflation seen in September and October is expected to have subsided last month.  The mean prediction for the monthly price gauge sees a modest 0.1 percent increase while the annual figure is still unknown.  Expectations of controlled inflation pressures for the period are mostly rooted in stabilizing energy prices. In the previous two months, the sharp drop in the price of crude prices led to an 8.3 percent and 9.7 percent contraction in the petroleum group.  For November however, the picture has changed.  Aside from a quick touch on a $54.86 low in the middle of the month, the average price per barrel hovered closely around the equilibrium level of $60 per barrel. This suggests that the ultimate change for the month of the overall IP index will lay with the other categories.  In the past few months, industrial goods prices have tracked energy lower for a sizable contribution to the overall reads.  Also, strength in auto and consumer goods sales revealed in recent indicators could have encouraged modest inflation on their own. Should the sharp contractions in the US import costs ease in November, expectations for the later released CPI will likely follow suit; and the Fed will find some justification for keeping its focus on inflation at the last policy meeting.

Previous: Import prices dropped 2.0 percent for a second month in a row in October. Twice as big as expected by economists, the contraction was paced once again by cheaper petroleum prices.  The volatile energy group was paced lower by unrefined crude oil prices. Starting its decent in August, oil prices proceeded to cascade from record highs reached in July to below $60 per barrel in October. At the same time, industrial supplies were tethered to the declines as prices for the unfinished goods slipped 5.6 percent on average.  Aside from these two sizable moves though, the component moves were modest.  Vehicle and parts prices rose for the first time in three months on a 0.3 percent advance.  Consumer goods achieved a third consecutive 0.1 percent pick up.  Taking the inflation numbers from a different angle revealed a effect cheaper raw materials prices had on imports from countries in the commodity bloc versus those that are net manufacturers.  For example, Imports from Canada were 3.4 percent cheaper while those from Japan were only 0.3 percent lower.

Japanese Tankan Large Manufacturers Index (4Q) (23:50 GMT; 18:50 EST)
                      (Lge Mfg)              (All Industry)
Consensus:         25                        12.1%
Previous:             24                        11.5%

Outlook:  The headline Tankan Index reading for large manufacturers in the fourth quarter is widely expected to rise to 25, as sentiment amongst businesses in the Japanese economy continues to exhibit positive momentum. Additionally, All Industry Capex is anticipated to pick up to 12.1 percent from 11.5 percent,  as companies are using rising profits to increase production and outlays on factories and equipment, helping to drive Japan's longest postwar economic expansion. Earlier in the month, Bank of Japan Governor Toshihiko Fukui said that a rate increase is â�,��"unavoidableâ�,� to prevent excessive business investment and asset-price bubbles. Should the capex result prove to be heating up at a substantial pace, the probabilities of a December 18th hike by the Bank of Japan will increase dramatically.

Previous: The quarterly Tankan survey of Japanese Industry unexpectedly jumped to a reading of 24 in the third quarter against estimates of a more gradual climb to 21. Business confidence in Japan was given a boost by lower exchange rates, helping to drive the critical export sector. However, capex missed predications at 11.5%, leaving traders pessimistic that spending by businesses would not be able to help fuel the economy. Nonetheless, continued optimism by manufacturers has helped to tighten the labor market in Japan, increasingly the likelihood that wage growth would eventually come to fruition. However, with consumption figures holding an inordinately low levels and price pressures remaining tepid, the Bank of Japan opted to keep rates on hold throughout the quarter.

Richard Lee is a Currency Strategist at FXCM.