We got an interesting political weekend in France where former President Sarkozy was eliminated in the first round of the center-right presidential primaries.

Interestingly, his former Prime Minister Fillon has emerged as the leading candidate for the second round, in spite of the fact that French opinion polls had Fillon only in third place a week or so ago.

Yes, what political opinion polls can you still trust?

The second round of the primaries in which former Prime Minister Juppe challenges former Prime Minister Fillon will take place next Sunday of which the outcome is of utmost importance for the future of the EU and of France of course.

Meanwhile, President elect Trump hasn’t told us yet who will be U.S. Secretary of State or U.S. Treasury Secretary and who will get the U.S. defense position. So, investors will continue to scan twitter to see ASAP what signals may be coming through. 

U.S. government bonds steadied near their post-election lows as investors continued to ponder the likely inflation and bond supply consequences of a Trump Presidency. Indeed, Trump’s impact on inflation is more likely to be a story for 2018 unless the trade tariffs are early and aggressive.

Besides that, we have seen global bond market coming down by 4.6 percent over the last 2 weeks, which is more than 4 standard deviations from the mean. 

Yes, that’s serious stuff…

But the moves hereto to could also be reflecting the inflation that is already set to take place in the coming months, as the U.S. economy pretty much operating at full capacity.

Today, we also have a fair amount of central bank speak with a barrage of ECB speakers headed by Draghi who said in his prepared speech: “GDP in the euro area has exceeded its pre-crisis level for the first time in 2016.”

Markets have shifted their attention away from the ECB somewhat of late, but with the December 8 meeting looming there may be a need of a somewhat refocus on the vexed issue of quantitative policy.

Fed Vice Chair Stanley Fischer will discuss monetary policy, inflation rates and economic outlook at the Council on Foreign Relations in New York. With rifts in the Fed still apparent, Fischer’s remarks will be scrutinized to see how closely he is aligned with Fed Chair Yellen’s comments that she made last week.

Anyway, on Friday, Kansas City Fed President Esther George said that “Monetary policy should avoid deliberately stoking the risks that come with overheating the U.S. economy,” a view which was broadly espoused by St. Louis Fed President James Bullard, who noted that he is leaning towards a December hike.

New York Fed chief William Dudley meanwhile described inflation expectations as “well-anchored” whilst Dallas Fed President Robert Kaplan said that he is “comfortable” with removing policy accommodation. 

Besides all that, this morning in the UK, Prime Minister Theresa May told in a prepared speech at a conference of the Confederation of British Industry (CBI) that is UK’s biggest business organization she is committed, and this is important for businesses and investors alike, Britain to having the lowest corporation tax of the world’s 20 biggest economies, suggesting that the UK will cut corporation tax further and faster than expected (details to be revealed in Wednesday’s “Autumn Statement”), and potentially going lower than the 15 percent rate promised by Donald Trump ahead of the US presidential election.

Finally, and this is serious food for thought for dollar-based investments, the Bank for International Settlements (BIS), which is considered as the central bank of the major central banks, just released a working paper in which it states that 1 percentage point (aggregate) appreciation of the U.S. dollar causes a 49 basis points (bps) decline in the growth rate dollar-denominated cross-border bank lending.

Yes, this is food for thought and in simple words this could mean that the current dollar bull run could come to an end much earlier than many think is possible/probable. When we also take into account that there is a possibility the ECB could start tapering its quantitative monetary policy in 2017 and we get a complete other picture for the dollar and the euro than we have today.

Of course, the political risks that the Euro area faces will continue well into 2017 and that still remains a serious headwind for any sustainable strengthening of the euro. Anyway, as a long-term investor I would put the subject on my radar.

Etienne "Hans" Parisis is a bank economist who has advised global billionaires and governments on the financial markets and international investments.