US payrolls numbers are top of the data diary this week along with global PMIs. But as David Pollard reports, this month's employment report could be viewed with some suspicion, thanks to the impact of Hurricane Harvey.
The dollar's back in fashion. A strong surge last week setting it up for some of the biggest rises of the year. While world stocks appear on course for their best run in over a decade. Donald Trump's plans for a massive tax overhaul continuing to boost global sentiment. (SOUNDBITE) (English) GLOBAL FINANCIAL ECONOMIST, COMMERZBANK, PETER DIXON, SAYING: "It's all going to be about the music which is playing out over the course of the next week with regards I think to Trump's tax plans as we get more and more of a sense of how much congressional support there is for them." Though in the US itself, the mood music is dominated by the wind section. As Hurricane Harvey leaves an economic trail too. GDP was a robust 3.1 per cent in Q2 - but could slip by over half a per cent in Q3 thanks to its after-effects. Consumer spending barely rising - and adjusted for inflation, actually fell in August. Though perhaps by not enough to force a change of direction at the Fed. SOUNDBITE (English) CHIEF ECONOMIST, WORLD FIRST, JEREMY COOK, SAYING: "Obviously were we to see a dramatic fall off of inflation or whether we saw a real hit to growth by some kind of black swan event and that could easily way lay the Federal Reserve but they've been setting expectations fairly concretely that we will have another rate rise by Christmas." But it does mean that this week's headline data - US payrolls - will be looked at with suspicion as investors search for signs of distortion. While Trump's tax plans could face heavy weather of a different kind. SOUNDBITE (English) CHIEF ECONOMIST, WORLD FIRST, JEREMY COOK, SAYING: "We've heard a lot of Republican support for a lot of Trump's speeches so far this year and we haven't actually seen much legislation change. There's a lot of running on this road to do before we actually get a change in tax law." Elsewhere, PMIs dominate the data diary. And look out, too, say economists, for Italy. With a stubborn 11.4 percent jobless rate, unemployment and retail sales data this week could hint at what sort of voter test it faces, in elections due by the end of May. Those themselves seen as Europe's next big test - after the recent upset of the vote in Germany.