Apologies to the loyal readers of this missive, yesterday was about the FOMC and my inability to do everything in time. Today is the same. I’m chairing a conference in London and found between sketchy internet and jet-lag that writing a timely piece was impossible. I’ll make it up with a review of the conference later. Time remains a key component for all traders – and waiting it out for change will be important. The Philippines, Indonesia and Taiwain central banks were all on hold today. So too was the Swiss National Bank. “It may be some time before the outlook for jobs and inflation calls clearly for a change in US rate policy,” Mr. Powell said. The compare and contrast today is between the FOMC Powell patience with the dot-plots signaling no more rate hikes this year - 11 of 17 officials up from 2 in December - against the impatience of the Norges Bank which hiked rates 25bps to 1% today. "Our current assessment of the outlook and balance of risks suggests that the policy rate will most likely be increased further in the course of the next half-year," noted Norges Governor Olsen. The impatient view of the day is also in the market mood for Brexit solutions which have nosed dived from a delay of length to a short respite from oblivion as no-deal Brexit scenarios return to risk books. The makes it clear that central bankers matter less than politics as equities respond to fears of a global slowdown from US/China trade doubts and Brexit hangovers. NOK/GBP is the one to watch as GBP is drops 0.45% against the USD and the NOK rallies 1% against the USD. This is a world that has grown impatient with waiting – and how the BOE handles this today is the next story.

Question for the Day: Is Dr. Copper still a good indicator for global risk? China and the US are the focus of Copper use and demand and dotted line connect the real economy to the financial one. Copper pipes used to be part of the shadow banking world of collateral debt. The US housing market and recovery was also a key part of the connection. Markets have seen China be a bigger driver of copper demand than the US over the last 10 years. As the WSJ notes today, The Shanghai Composite, China’s main stock benchmark, and global copper prices have risen in tandem since the start of the year, with the latter gaining 9% and the former up a full 23%. Recently both have lost steam.

The driver of the stock market recovery in the US was the FOMC patience shift and the China/US trade talk hopes. In China, the relaxation of credit restrictions from the PBOC was highlighted. The PBOC RRR cuts and the margin loan lending for shares are highlighted. The actual demand and shadow banking health is in question. This puts Dr. Copper on call for its connection to the real global economy again.

What Happened?

Australian Unemployment and UK Retail Sales stand out as news to consider. The Australian unemployment rate fell to 4.9% from 5.0% - but all because the participation rate fell to 65.6% from 65.7% as the job creation slowed to 4,600 less than the 15,000 expected. As for the UK, the retail sales surprised to the upside up 0.4% rather than dropping 0.4% as expected.

Market Recap: Will return tomorrow. 

Conclusions: Is EM in trouble even with a dovish tilt to Fed patience? The Wall Street Journal article today highlights two BIS papers on EM that are required reading for those that use the playbook that US patience means EM gains. EM FX isn’t yet caught up to EM bonds and equities. The inflow of money has some clear implications for risk over the next quarter as the bet is that time buys growth and heals all ills from Brexit and US/China tariffs.  

Economic Calendar:

• 0800 am BOE rate decision – no change from 0.75% expected
• 0830 am Canada Feb ADP employment change 35,400p 25,000e
• 0830 am Canada Jan wholesale sales 0.3%p -0.1%e
• 0830 am US weekly jobless claims 229,000p 226,000e
• 0830 am US Mar Philly Fed Manufacturing -4.1p +5e
• 1000 am US Feb conference board LEI 0%p 0.1%e
• 1100 am Eurozone Mar flash consumer confidence -7.4p -7.4e
• 0100 pm US 10Y TIPS sale