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US strength, elsewhere not so much

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  • Tartan tracking - Opinion polls over the weekend had one giving a lead to Scotland's independence vote, and three rejecting independence, but there are questions over the likely accuracy of any poll.  Scotland's First Minister somewhat downplayed the risk of a further referendum in the event of a "no".
  • The US data today should show strength in the Empire State sentiment index, but a somewhat softer industrial production reading. We do not see Wednesdays FOMC changing language, in spite of the better tone to data of late.
  • Chinese industrial production numbers hit a five and a half year low, and government construction spending and retail sales were softer than expected. This is raising the possibility of a further stimulus package from the government, potentially including rate cuts.
  • With the Euro area experiencing weaker growth recently, we have revised down our Euro area GDP forecast for this year to 0.9%. Within that Spain is expected to do better, but Germany, France and Italy have been revised lower. Debt issues mean that investor attention is likely to focus on the latter two.

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