*  Incoming data sent reassuring signals in the euro area and the UK this week.

*  Despite that, the MPC minutes indicated the committee remains open to further easing measures.

*  In contrast, in spite of recent weak data, Chairman Bernanke indicated the Fed is not close to putting additional stimulus in place.

*  Growth data in Brazil are softening on schedule, which, along with benign recent inflation readings, is leading the Copom to tighten at a less aggressive pace.

Developed Economies
US: Housing looks for a bottom amid uncertainty

Despite an outlook that is "unusually uncertain," Chairman Bernanke said that additional stimulus is unlikely unless the outlook "worsens appreciably."

Euro area: Stress test results unlikely to stress out markets

Markets expect no major surprises for banks of systemic importance, focusing on peripheral banks and core countries' banks with large exposures to sovereign risk.

UK: Strong GDP may ease QE extension concerns

The strong rise in GDP in Q2 could help to alleviate the MPC's policy dilemma, suggesting that additional QE may not be needed.

Japan: Improvement in the job market and steadiness in production

Why does sentiment among households and corporates remain solid despite the erosion in market sentiment? What is the source of this decoupling?

Emerging Markets
China: Expansion of renminbi business in Hong Kong

China has lifted some restrictions to expand RMB business in Hong Kong, marking a significant step in the development of the RMB offshore market.

Emerging Asia (ex-China): Gliding down gently

Even with the ongoing moderation in export momentum, we see upside risks to our Q2 GDP projections for EM Asia.

EMEA: Fiscal weakness with stable inflation

Fiscal adjustment pressures in Hungary have had negative market consequences, and led to political tensions in Romania.

Latin America: Moderation and its discontents

Despite the ongoing slowdown fears epitomized by Copom's smaller-than-expected hike this week, incoming data from the region have not been generally disappointing.

J. Zuniga