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Growth signals?

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  • Comments from US Fed Chair Yellen were boringly consistent with an October ending of quantitative policy, and broadly consistent with the idea of a Q2 2015 interest rate increase. There was some warning given of the potential for an earlier tightening if data improves.
  • The US retail sales data (in the detail) will add more than expected to Q2 GDP. Today we get industrial production, and also the Fed's Beige Book. The latter is helpful in gauging the health of small businesses, as well as labour market slack and credit creation.
  • Chinese second quarter growth was marginally stronger than expected (President Xi wants 7% to 7.5% growth, and funnily enough that is what he is getting).  One has to have a naïve faith in the quality of Chinese data (or any GDP data) to see this as a major event for the rest of the world.
  • European leaders gather together in the wake of that mighty Luxembourger, Mr Juncker, being confirmed as one of the three EU presidents. The UK releases labour market data in the wake of the stronger consumer price inflation figures yesterday.

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