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A life of ease?

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  • The Fed added a rather even handed assessment of what it might do with quantitative policy to the statement that accompanied its (unchanged) interest rate decision. The remarks probably need to be framed in the context of concerns about fiscal drag in the economy.
  • the Bank of Japan minutes were what one would expect from a central bank that has opened the liquidity floodgates. The ECB lies ahead today, having been unusually forthcoming in their intentions. We see a 25bp cut in rates, but the ECB is restricted on being able to do more.
  • Euro purchasing managers' data is expected to show an accelerated pace of decline. Anglo-Saxon equivalent data has done somewhat better than expected, but the Euro's problems are now quite specific to the Euro area, and weakness here would be consistent with data from Asian exporters.
  • US data covers trade and productivity today, but sandwiched between the Federal Reserve and the employment report tomorrow, it is unlikely to be that much of a distraction for financial investors.

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