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Peculiar decision creates division

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  • The minutes of the US FOMC meeting that preceded the September policy error show deeply divided Federal Reserve. That is not a surprise, though the strength of hawkish sentiment and the idea that bond purchases could still conclude mid 2014 are perhaps surprising.
  • There are reports that US Republicans in the House may be prepared to do a short term debt limit extension, to give a window of opportunity for larger fiscal discussions. House Republicans meet with President Obama today (the first time since the government shutdown).
  • Japanese bank lending rose 2% - the good news of which is somewhat blunted by the fact that a lot of lending is loans to Japanese local government. Consumer sentiment was a little less negative than expected, and machinery orders were good.
  • The Euro area offers consumer price inflation, and French and Italian industrial production data. The production numbers may be worth looking at as these have been a bit softer of late. The Bank of England rate decision is not likely to excite attention.

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