We are seeing significant investment. The rate of addition to the capital stock is as great if not greater than anything we have seen in the past 20 years.

Much of this liquidity appears to be coming from China and increasingly Japan where investment trust growth is supplying significant volumes to foreign bonds with little regard to the rising global imbalances that policy makers frequently flag as a risk to the global economy.

It's not hard to understand why business confidence surveys report significant pessimism.

This concern suggests it will take a lot of strength to get the Fed to tighten beyond 5 per cent.

It will be a while yet before we are printing better numbers.

But we don't think this language quarrels with the consensus view of financial markets - and our view - that an easing cycle will most likely begin in September.