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Exiting the crisis (in some places)

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  • Euro area M3 money supply is due. If ECB president Draghi's foray into the monetary policy unknown of negative rates is to have any real world impact (other than upsetting the Germans) then we need to see higher M3 money supply growth coming through.
  • UK Q2 GDP is due, expected at a real 3.1% yoy. This will take the UK real GDP above pre-crisis levels. In nominal terms GDP has far exceeded the pre-crisis level (relevant for debt metrics). Per capita the figures are less good, as immigration has been a contributor to growth.
  • Japanese inflation slowed a fraction on the headline figures to 3.3% yoy, but also slowed excluding the consumption tax (to 1.3% yoy). We see base effects continuing to slow the consumer price inflation rate.
  • The US is revelling in the wake of significantly lower initial jobless claims figures - relevant of course with the Fed's focus on labour market data. Durable goods orders are due today, but are volatile and tend not to be too closely regarded in markets.

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