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After the carnage seen in emerging markets and equities towards at the end of last week, we are at least seeing some stability emerge, but the fallout remains all too clear to see. As is often the case and especially on a Friday, it’s near impossible to say why we saw such a sudden reversal, but concerns regarding China together with the more fragile sentiment in emerging markets in general were certainly in the background. For FX, the yen and Swiss franc strengthened the most on the majors, with the dollar bloc currencies (kiwi, Aussie and Canadian dollar) seeing the most losses. Emerging market currencies as the Rand, Brazilian real and the Turkish Lisa saw losses between 2.5% and 4% over the week. For today, the main focus will be with the German IFO data, released at 09:00 GMT. This is seen as the best indicator of the health of German industry. Whilst firmer numbers will give some further support to the single currency, the issue for the ECB is that the deflation in the periphery is the bigger concern for policy and strength in German output just complicates the difficulties they already have in setting policy for the euro area as a whole. Elsewhere, thoughts are turning towards the next US FOMC policy meeting this week, where a further modest cut in the monthly amount of bond purchases is expected and likely to be less disruptive for market than keeping things as they are.