Rate hikes are coming
• Finally, markets seem to be getting the message that the Fed will add monetary tightening to the existing quantitative tightening of policy. Fed President Lockhart was cheerleading the idea of a September rate hike as being the right time (there are those that think September a little late, but that is another story).
• The service sector ISM business sentiment data in the US is unlikely to be a high profile statistic for the Fed, but the labour market components may be worth looking at – the employment cost index has some anomalies in service sector wage growth.
• European service sector sentiment seems likely to be immune to the problems of the Greek situation – the manufacturing sector managed to escape too much damage. The exception to this if of course Greece itself, where the nominal growth (and thus tax revenue raising) position remains bleak.
• There has been a sudden flurry of interest about a possible delay to the inclusion of the Chinese renminbi into the IMF's SDR basket. The change to the basket may be delayed, but that does not mean a delay in the timing of the decision about including the Chinese currency.