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What really matters (and it is not the G20)

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  • The G20 is demonstrating statecraft by Twitter. The Italian Prime Minister tweeted about divisions in the G20 over Syria �€“ which is a bit nonsensical as to have divisions implies that there was coherence to the G20 in the first place.
  • Away from the expensive photo op of the G20, what matters is the US labour market data. Expectations of a stronger number have grown in the wake of strong sentiment data. We forecast 210k for payrolls, unchanged unemployment, and 0.2% earnings.
  • Politically a good labour market report would seem to be a necessary condition for the Fed scaling back its bond buying program. Economically what matters is the extent to which past monetary accommodation is being put to work in the economy (the money multiplier effect).
  • Australia heads into the weekend's general election with opinion polls suggesting victory for the opposition coalition. The UK provides industrial production data , and the ECB has LTRO repayments today.

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