While concerns about China are currently dominating markets the Fed's decision on interest rates will ultimately be driven by its assessment of US economic conditions. Today's retail sales data for July will provide the first official indication of the pace of Q3 consumer spending growth.
Spending in July is likely to have increased by 0.7%, says Lloyds Bank. Reports from auto dealers suggest that car sales were buoyant, while high street sales are also reported to have picked up. With the fundamental drivers of consumer spending still positive, including high levels of consumer confidence and decent real income growth, there is every reason to expect consumption to continue to drive US economic growth.
Elsewhere it is a quiet day for data releases. The minutes of the last ECB policy meeting are set to be released. However, these are unlikely to contain any surprises given the current consensus amongst policy makers that the ECB needs to continue its stimulus program, states Lloyds Bank.