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Inflation and influence

| Posted by: Paul Donovan | Tags: Paul Donovan

The European Court is to rule on the legality of the ECB's OMT program – a rather quaint decision as we passed the concerns about the OMT several crises ago. Meanwhile the Greco-German crisis item of the day is the Greek Prime Minister saying he will not offer new proposals at Thursday's Ecofin.

The German ZEW expectations survey is due, and with domestic demand remaining robust in Germany should prove OK. Final CPI inflation is also scheduled – the initial data surprised on the upside (as it has done all year) but this is just a revision.

UK inflation data has been less inclined to surprise positively, partly because of supermarket price competition (a temporary issue), and partly because UK wage growth has been somewhat restrained by the UK's pools of available labour – the pools being stored in continental Europe and imported as needed.

Bank of Japan governor Kuroda said that when he tried to influence the level of the yen last week he did not mean to try to influence the level of the yen, so he is trying to influence the level of the yen now to reverse the influence he had on the level of the yen before the weekend.