morning note

A 50 bps interest rate cut from Russia’s central bank and Latvia saying
they will maintain their peg to the euro after yesterday’s failed bill
auction (based on fears of a devaluation) pressured Swiss banks that are
exposed to Eastern Europe, are helping to lift some European markets.
The FTSE turned negative though after the BoE left rates unchanged as
expected and kept the size of their asset purchases of 125b pounds
intact and said it will take another two months to finish. Following
rumors, the UK government said talk of PM Brown resigning was ‘complete
nonsense.’ The ECB left rates unchanged also as expected and we’ll hear
Trichet’s thoughts on policy at 8:30. Highlighted by German Chancellor
Merkel’s criticism of easy Fed policy, again, the ECB is not going down
the same path as the Fed. Initial Jobless Claims are expected to total
620k and would be the 8th straight week below 650k but because of the
lack of hiring, Continuing Claims are expected to rise to another new
high. Retail comps so far look light.

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