Market Movers ahead

  • In the US, focus is on retail sales and CPI inflation in September. In our view, there could be some downside risks to retail sales, which have been relatively strong in recent months.

  • In China, focus is on foreign trade data for September, which should give us an indication of the current state of the Chinese economy.

  • In the euro area, focus continues to be on how large a negative effect we might get from the recent weakness in the emerging markets. We believe both ZEW expectations and industrial production declined.

  • In the UK, we believe that ‘noflation’ continued in September while wage growth continued higher in August.

  • In Sweden, we continue to believe that the Riksbank is too optimistic on inflation going forward and that the bank will be forced to ease further in December. We estimate CPI and CPIF at -0.1% y/y and 0.9% y/y, respectively.

  • We estimate Danish CPI inflation was unchanged at 0.5% y/y in September.


Global macro and market themes

  • More German softness is looming due to the combination of Chinese turmoil and the Volkswagen fraud.

  • We have postponed our call for a Fed hike to the beginning of 2016 – markets have pushed it to mid-2016.

  • Fixed income market in ‘erase and rewind’ mode this week – we expect further USeuro spread widening.

  • EUR/USD is set to continue range trading for the next couple of weeks.

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