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Fed fun, and France fed up

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  • The US Fed's Yellen issued a written statement ahead of her testimony to Congress today. The statement said little about quantitative policy per se, but stressed her monetary policy concerns about spare capacity. Bernanke also emphasised the spare capacity of the US economy.
  • Japanese finance minister Aso commented that it was only right that Japan have foreign exchange reserves to smooth movements in the markets (one never knows when one might not need in excess of a trillion dollars at hand). Japanese industrial production was revised down a little.
  • France's third quarter GDP came in weaker than expected with a negative quarterly rate �€“ and while this data is subject to revision, the weakness of real and nominal GDP in France is a challenge, particularly as Germany's experience seems to be pulling it away from France.
  • Yellen's testimony dominates the data calendar, but in the meantime we have UK retail sales (in the wake of Bank of England optimism), and GDP from the rest of the Euro area. Italy (also seen with negative GDP) may be a source of investor interest.

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