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The slow death of global free trade

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The G20 did nothing constructive (one can question whether the G20 has ever done anything constructive). The final communique omitted mention of opposition to protectionism. Including opposition to protectionism in the statement has not stopped protectionism, but omitting it is a signal of shifting priorities (from the US).
  • US FBI director Comey testifies to Congress. US President Trump's accusations of being wire tapped will come up. This matters to investors because White House-Congress relations are being affected. Congressional approval is needed for Trumpcare, tax reform, infrastructure spending, etc., so relations with Congress matter to markets.
  • German producer price inflation is scheduled for release. Rising German inflation is important this year, and it is local factors that are behind it. Producer prices are also a better indication of corporate pricing power than are consumer prices. Bundesbank President Weidmann is scheduled to speak as well.
  • US Fed member Evans is scheduled to speak as is Bank of England economist Haldane. Haldane's comments may be more relevant as the Bank of England had an unexpected hawkish dissent at its last meeting. It remains to be seen whether this was a maverick position or an early warning.