In what can we trust?

Daily update

The Federal Reserve meeting minutes offered no surprise—a majority of members thought inflation a bigger threat than unemployment, which was obvious given the vote. US President Trump called for a Democrat-appointed Fed governor to resign. In the broader context, investors may worry about whether the Fed still has the appearance of being independent. In a fiat currency system, trust is key and even the appearance of undermining independent policy or data is dangerous—in this case, also threatening the US dollar’s reserve role.
US initial jobless claims give an incomplete glimpse of the health of the labor market. Government policy uncertainty has caused firms to pause—not firing, not hiring. The continuing claims number is therefore something to focus on.
There are assorted business sentiment polls due in Europe and the US. If official data is compromised, such polls may get more attention. In the absence of official data to act as a benchmark, the reliability of such polls becomes more difficult to measure. There is a risk people take such polls at face value (which would be a bad idea).
UK July public sector borrowing was fractionally less than anticipated, with tax receipts growing quite firmly. The UK has been the fastest growing G7 economy year to date.