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The minutes tick by

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The US Federal Reserve Minutes loom over financial markets today. The last FOMC meeting seemed content with the idea that rates would rise in the US this year. However there is enough uncertainty about the general state of the economy to make these minutes of peculiar interest.
  • Noyer of the ECB yesterday signalled that quantitative policy could continue beyond September 2016 if necessary. Implicit in those remarks is the idea that in ordinary circumstances the ECB base case is for the policy to conclude in September.
  • The UK media has comments on CPI turning negative for the first time since 1960 (which is factually inaccurate. RPI was negative in 1960 and is positive today). Against this backdrop the Bank of England minutes are due – given the Governor's recent remarks there may be some discussion on the UK's role in Europe.
  • Japanese GDP came in stronger than expected (good news) but this was due to inventory accumulation not domestic demand (band news, or at least not good news). Real export growth was good, which rather defies the US data. Someone has to be buying this stuff, after all.