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Lacker, lackluster performances, and data lacking quality

| Posted by: Paul Donovan | Tags: Paul Donovan

  • US Fed President Lacker (not a voting member) resigned after an investigation into leaked information. This may fuel political attacks on Fed independence. Quantitative policy is not an inflation threat when managed by an independent central bank. Quantitative policy and a politicized central bank are a dangerous combination (see Reichsbank 1923 for details).
  • Those ever-accurate barometers of public views, the opinion polls, have declared a lackluster performance for French presidential candidate Le Pen in last night's debate. This does not mean a great deal to voting intentions, perhaps, but international investors may react to the headlines.
  • The data calendar is crowded with more opinion polls – purchasing managers' sentiment for the service sector. The data tends to exaggerate underlying economic trends, but it gives television anchors something to talk about and thus raises their prominence.
  • UK labor cost data is due out. Ordinarily this would be buried in obscurity, but in the post-EU world where relative competitiveness is likely to be more closely scrutinized, watching this sort of data may become important.