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Europe strikes back

- "In the US the FOMC meeting is the main event next week. We believe that the
speculations about further monetary easing are premature, but that the assessment of the current economic situation will be downgraded. We expect US July retail sales to increase 0.5% m/m after a weak H1 2010."
- "For the euro area, the key event next week is expected to be the release of Q2 GDP data. We expect to see robust growth, but at a rather uneven pace. Germany is expected to stand out as the top-performer."
- "UK inflation report on Wednesday is expected to weigh on GBP and support Gilts."
- "In Scandinavia focus turns to inflation numbers out of Denmark, Sweden and Norway. The monetary policy meeting in Norges Bank will not attract much attention. Unchanged rates are widely expected."
- "Over the past month the euro area has been the main provider of good news while US data have disappointed. The German Ifo index, German factory orders and Euro PMI all surprised to the upside, while US data covering housing, business and consumption have all been weak."
- "The relative stronger numbers out of the euro area relative to the US and less PIIGS
concern have pushed EUR/USD above 1.32."
- "Wheat prices rise strongly on Russian drought and subsequent export ban. A new food
crisis cannot be ruled out if the export ban spreads to other countries like we saw in 2008. However, global wheat stocks are in fact plenty and other grains prices are not rising to the same degree."

DenDanske Weekly Focus 20100806

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