In the data calendar focus is on durable goods orders and new home sales in the US. It will be interesting to see if there are any signs of a negative impact on home sales from the increase in mortgage rates in recent months. New home sales dropped markedly in July, so some rebound should be expected in the August numbers.
In the US focus will continue to be on the negotiations to secure an agreement on funding of government expenditures for the new fiscal year starting on 1 October. A Senate vote is expected this evening. Unlike the House version, the Senate bill will not include stripping Obama's healthcare plan for funding.
Europe has a relatively light calendar today. Most interesting will be speeches by Bundesbank president Jens Weidmann and ECB board member Jörg Asmussen. We continue to look for signs of a possible policy response (including a new LTRO) to stem the increase in money market rates.
In Sweden National Institute for Economic Research will publish its business and consumer confidence surveys and in Norway the LFS unemployment rate for July is expected to remain unchanged at 3.3% confirming that growth is not far below trend.
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