The IMF holds their annual meeting in Washington D.C. this week, against the backdrop of a US government shutdown and a looming debt ceiling deadline. While these will certainly be topics for discussion, they are unlikely to be on top of the agenda, as representatives from all over the world descend on the nation’s capital.
Instead focus is set to be on the developed world’s monetary stimulus efforts and their impact on global capital flows, in hopes of greater co-ordination in policy. Last week, IMF Managing Director Christine Lagarde told an audience in New York that she did “not expect global growth to be much higher this year than last” and discussed the risks posed to the global economic outlook from currency crises in emerging markets and unsustainable debt levels in places like the US and Japan. These comments will likely serve as a prelude to today’s release of the IMF’s World Economic Outlook and the accompanying news conference by the group’s Chief Economist Olivier Blanchard.
It’s a relatively quiet day for new economic data. Release of Germany’s August current account, trade balance, and factory orders will likely garner the most market intention this morning. We expect the more forward looking factory order data to show a rebound, up 1.5% in the month, after declining by 2.7% in July. France’s August trade data and Spain’s industrial production are also due out this morning. Later in the day, US September NFIB small business optimism is scheduled for release, but US trade data will be postponed due.