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Mainly central bankers

| Posted by: Paul Donovan | Tags: Paul Donovan

  • Constancio, the outgoing vice president of the ECB is scheduled to speak. The politics of the replacement process is probably more interesting than any comments on policy – although how much Constancio echoes ECB President Draghi's dovishness may be interesting. Nowotny of the ECB is also speaking.
  • Harker of the Fed is speaking in Japan, and Bank of Japan Governor Kuroda is speaking in Zurich. The Fed's policy path is pretty clearly priced into markets, at least for this year, and the composition of the Fed is too uncertain in 2018 to allow one speech to influence longer-term expectations.
  • UK politics linger on, weakening sterling a little in Asia. There are reports of an internal challenge to the prime minister. The EU-UK UK-EU divorce proceedings are also generating contrasting signals (over jobs, and over the risks of a no-deal exit).
  • Bitcoin's moves over the weekend were an interesting diversion. Spending power collapsed over a 48-hour period. Reportedly, people have been switching to other crypto-currencies. The flaw with crypto-currencies is that when demand declines, supply cannot decline. This undermines their value. The latest Chief Economist's Comment, out now, coincidentally looks at the economic consequences of bubbles.