Market movers ahead
In the US, we believe the recent tightening in financial conditions and increased uncertainty on global growth will sway the Fed to keep rates unchanged at its meeting next week, despite a strong labour market and solid domestic demand.
In the UK, we have several important releases next week. As the Bank of England’s focus has moved to inflation, CPI inflation in August will attract the most attention. But the labour market report and retail sales will also be important releases.
In Japan, focus is on the Bank of Japan (BoJ) meeting. We do not expect the BoJ to announce additional easing measures at this meeting.
In China, focus next week will be on industrial production for August, which will provide more clues on the state of the Chinese economy.
In Sweden, the Riksbank minutes from the previous monetary policy meeting should shed light on the recent decision to leave rates unchanged.
Global macro and market themes
China acts forcefully to narrow CNH-CNY spread
Good opportunity to sell CNH and hedge receivables
Weak Chinese economy causing pain in Brazil
EM pressures continue
Strong US job data keeps Fed hike on track for December
Bond yields caught between weaker macro picture and Asian selling
Focus
China acts again in establishing a ‘single currency’ (see China: Intervention in CNH narrows CNH-CNY spread , 10 September 2015)
The Fed swayed to keep rates unchanged amid tighter financial conditions and global growth concerns.
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