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Fed fun

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The Federal Reserve concludes its meeting today – and in the real world not much has changed. Data continues to show a US economy that is performing OK, and a US consumer that is indifferent to the hothouse environment of financial markets.
  • The Fed is not going to want to make volatility – it is not (normally) a vindictive institution. A likely solution would be to signal awareness of the risks of market volatility, but emphasis the lack of real world justification.
  • There is confidence data from France and Germany today. Confidence data is a weak economic indicator, but that does not stop markets paying attention to it. There is a question as to whether political risk rather than economic matters may influence current data.
  • Australian consumer price inflation for the fourth quarter came in at 2% yoy, in line with expectations. That, of itself, is a little unexpected as global inflation has tended to surprise on the upside over the past few weeks.