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Up, up and away

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The G7 heads of government failed to agree on any common statement about imminent global threats. Abe of Japan had been keen to see something along those lines, perhaps because it would justify his fiscal policy desires.
  • The G7 did weigh in with a statement on the EU referendum in the UK, suggesting that it an exit would be a "serious risk" to growth. Opinion polls have suggested that those in favour of exit do not rank economic arguments as important considerations.
  • Japanese inflation came in at -0.3% yoy in April – the second lowest inflation rate in the G7, in spite of the fact that Japan has the highest inflation expectations in the G7. This owes much to the positive inflation for high frequency purchases, and may also be a comment on the quality of Japanese CPI data.
  • US Q1 GDP should be revised higher today. This is not a surprise – the high frequency data has been supportive of revisions, and nearly all US economic data (growth and inflation) is being revised stronger these days. It opens the way for more speculation about US rate tightening.