Will global equities break their pattern in the December quarter?

“That said, we don’t think the RBA will go as far as signalling that it will soon be ready to raise rates,” Mr Dales said.

TD Economics agreed. “Unanimous consensus expects 1.5 per cent through to year end, and neutral RBA rhetoric has made sure that this will remain the case. We expect a control-C / control-V statement from September as to not draw unnecessary attention. We do not look for a hawkish tilt from governor [Philip] Lowe until February 2018 at the absolute earliest.”

It’s not just, of course, what the RBA sees in the future that matters.

Federal Reserve chair Janet Yellen seems as determined as ever to maintain a gradual rate hike path and she’ll get another chance to press that point when she speaks mid-week.

Trump eyes next Fed chief

It appears that Dr Yellen’s fate will be known soon. President Donald Trump said he expected to decide within weeks on who will chair the US central bank after Dr Yellen’s term expires in February. Mr Trump said on the weekend that he had narrowed his list to four: reportedly, Dr Yellen, Gary Cohn, Kevin Warsh and Jerome Powell.

As much as markets are keen to know in which direction the Fed may tilt policy going forward, the battle between hawks and doves will resume in earnest this week. In addition to Dr Yellen, nine key US policymakers will speak over the next five days including Robert Kaplan, James Bullard, John Williams and William Dudley.

Over the weekend Patrick Harker, the boss of the Fed’s Philadelphia bank, said he had “penciled in” a rate hike in December, and three more next year, despite weak inflation.

“Labour markets feel really tight,” the Fed official said at a conference in Philadelphia on Fintech.

Later this week, there will be fresh data on the US jobs markets though the statistics may be too skewed by the impact of hurricanes Harvey and Irma to draw any concrete conclusions.

“Assuming Irma carved payrolls by a little more than 100,000 and that underlying payroll growth is similar to the year’s average [of 176,000], we expect a 70,000 increase in September,” according to BMO Capital Markets.

“We expect the jobless rate to stay at 4.4 per cent in September. Average hourly earnings were little affected by past hurricanes; an expected 0.3 per cent monthly advance should lift the yearly rate to 2.6 per cent.”

Over the weekend, the US Commerce Department released personal income and spending data for August and the data came in slightly below expectations. Inflation continues to decelerate, confoundedly so. Whether that will give the Fed cause for pause won’t be known for some time.

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