Amidst signs of slowing global growth momentum the Fed has emphasized a more flexible approach to policy tightening. Although the ECB is only looking to begin reducing stimulus, it looks to be taking a similar tack already as it is faced with a delicate balancing act of reducing accommodation at a time when Eurozone growth has been slowing. Draghi acknowledged as much saying risk was a focal point of discussion and he’d summarise the assessment as ‘continuing confidence with increasing caution’.

Yesterday the UK Conservative party had its very own remain/leave vote of confidence in Theresa May, this time voting for their leader to remain by a margin of 200 to 117. However Theresa May later announced she would leave (before the next general election that is). As you can imagine, the tabloid headline writers had a field day, particular highlights being ‘Time to call it a May’ and ‘It’s lame duck for Christmas’.

Prime Minister Theresa May will face a vote of no confidence this evening, now more than 48 Conservative MPs (i.e. more than the required 15%) petitioned for such to the 1922 Committee. It seems the ‘backbench drivers’ are now reaching for the wheel after May took one too many wrong turns, postponing the futile Parliamentary Brexit vote earlier this week. This frustrated move to vote seemed almost inevitable but the success of it is far from certain; the 48 dissenters will need at least another 110 Conservative MPs to vote alongside them to reach the required simple majority.

In one of his last interviews before he retires from the International Monetary Fund (IMF), its chief economist has warned that the US may start to feel the effects of a sharp slowdown over the next couple of years, although he does not believe that it will result in a recession. Dr Maurice Obstfeld, speaking to the Financial Times and The Wall Street Journal said ‘We've long been predicting somewhat lower US growth for 2019 than what we are seeing this year’ adding the slowdown ‘is going to be sharper probably in 2020 than in 2019, according to the data we are seeing’. The warning comes after the IMF had already downgraded its prediction for US growth form 2.8% this year to 2.5% in 2019.

The last two Fed speakers on Friday before the blackout period ahead of the Fed’s meeting next week were Bullard, a non-voter, and voting Governor Brainard. Bullard, a dove, who has been constant in calling for restraint in rate hikes said he sees ‘no purpose in inverting the yield curve to try to be pre-emptive on inflation’. Brainard noted ‘that some tailwinds to the US economic outlook are fading’, though flagged that the labour market remains strong.