It's a massive week for financial markets, as the Federal Reserve takes centre stage and with monetary policy the big talking point.
Thursday sees the Fed make its latest announcement on interest rates, with many still uncertain as to whether we will see the much-anticipated hike this month or not.
European markets remained little changed yesterday, and we could well see that theme continue as investors try to position themselves around the announcement.
European and US markets have managed to shrug off many of the losses sparked by recent emerging market issues and have remained fairly resilient.
The Fed has stated all along that it is data dependent, so with numbers looking good and markets a little more stable, we could well be in line for some fireworks.
My view, however, is still that we won’t see a move until the new year, due to the uncertainty in global markets.
A report over the weekend showed that money is continuing to flow out of emerging markets. And although contagion may not be spreading into the US or Europe, emerging markets are still very much at risk from a rate hike.
Consequently, I think the state of the markets and investor confidence are too shaky.
This will worry the Fed too much to act before the situation in China – and more importantly the contagion to emerging markets – has calmed down.