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  • The Senate foreign relations committee is to vote today on a resolution allowing US military action in Syria. If passed, the full Senate will vote next week. This has encouraged an element of "risk off" to creep into financial markets once again.
  • Market attention should swing towards economic matters today, however, as investors focus on the prospect of the US Fed tightening policy. The Beige Book of anecdote is due today the housing market (which we believe to be supply side constrained) could be an area to watch.
  • Euro area and UK service sector sentiment data lie ahead today. The market is not really looking for anything other than the validation of existing trends (stabilisation in the Euro area with UK outperformance) and this is not therefore likely to distract from the US.
  • Australian service sector sentiment weakened for the nineteenth consecutive month. The second quarter saw slightly stronger GDP however, with the domestic economy moving out of recession. As long as that persists, the Reserve Bank should keep policy on hold.

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