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The terrifying sound of silence

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  • The economic calendar echoes to the terrifying sound of silence, with barely any noteworthy data releases scheduled. This allows investors to over emphasise minor points just for the sake of having something to react to.
  • China would seem to be a source of overreaction, with Asian markets musing on the possibility of sudden stimulus. While China's policy makers are unlikely to allow unemployment to rise this year, to leap from recent distorted data to a stimulus package is quite a jump.
  • US durable goods orders are pretty much the only main data release for the day ahead, but there is also some further Fed speak (Bullard today). The Fed's Plosser emphasised the uncertain path for monetary policy that lies ahead.
  • An aide to Japanese PM Abe was casually commenting that the Bank of Japan has room to do more stimulus if it wanted, and hinted broadly that May would be a good month for stimulus. The threat "or else" was implied, if not very subtly implied.

Listen to the audio version of this briefing.