All is well last week and financial markets roared. The ‘fear’ index had resided substantially from the orchestra of Brussels and the US. The month of October is one of the best since time can tell. Do not be carried away.
Wait a second. Let’s leave the US out of the equation. I am talking about Europe.
The speculation (before the G20 Finance Minister’ summit) was that Europe would not deliver a package deal. Now it is delivered (but without the details and specifications). The rally had come to somewhere of a consolidation and global investors are pondering if (and when) the details are to be announced.
· How soon can the specifications be announced is a question?
· How fast can all three process be implemented is another question?
· What if not all three can be agreed amongst the EU leaders is a worry!
· Would China and Japan support the EFSF without political benefits?
Hence, the EU needs to produce results within the shortest time span otherwise we’ll be on another roller coaster. Hopefully the G20 leaders’ summit may be more favorable.
There’s also the RBA rate decision, China Manufacturing data and the US payroll data on Friday.
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