A look at the day ahead in European and global markets from Kevin Buckland

A momentous couple weeks for global central banks brings policy decisions from two of the biggest on Thursday: the European Central Bank and the Swiss National Bank.

Rate cuts by both are not in question, but how deep those cuts will be is still up for debate.

The Swiss central bank decides first, and market-implied odds are tilted towards a half-point cut to 0.5%, ramping up in recent weeks after Chairman Martin Schlegel invoked the possibility of a return to negative rates if needed to dampen investor appetite for the safe-haven franc.

At the ECB, a more-standard quarter-point reduction is seen as the most likely outcome, but the 15% odds on a half-point cut suggest that traders see it as a non-negligible risk. The balancing act for European central bankers is an economy teetering towards recession, even as some of the more hawkish officials argue inflation is still a concern given rapid wage growth and spiking services costs.

The potential for big U.S. tariffs come January and simmering political crises in both Germany and France - the heart of the euro zone - introduce additional uncertainty.

Whichever way the ECB goes today, further easing is undoubtedly coming: Markets are priced for reductions at every meeting until June, followed by at least one additional cut in the final half of 2025.

Some major euro milestones are being eyed by corners of the market, including pre-Brexit levels versus sterling and even parity with the dollar for the first time since late 2022.

The United States releases PPI figures later on Thursday, a day after an as-expected and not-too-hot reading of consumer inflation all but cemented in the market's mind a Federal Reserve rate cut for Dec. 18.

The Wall Street rally that followed the CPI numbers, pushing the Nasdaq above 20,000 for the first time, has spilled over into Asia, boding well for European shares.

Meanwhile, the yuan stabilised on Thursday after the PBOC set a slightly stronger fixing. It had come under pressure the day before after a Reuters report that Beijing was considering further depreciation to counter any U.S. trade war.

Key developments that could influence markets on Thursday:

-SNB, ECB policy decisions

-Sweden, Ireland CPI (both Nov)

-US PPI (Nov)

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(By Kevin Buckland; Editing by Edmund Klamann)