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Tuesday, August 28

28th Aug - EU Open

EURUSD continues drifting slowly lower after hitting the channel top around 1.26, with room left below. SPX seems to be settling into a horizontal range (my Sunday views and Monday's notes)

Yesterday on MoreLiver’s:

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News roundup – Between The Hedges
The 6am Cut London – alphaville / FT
Emerging Markets Headlines – beyondbrics / FT

TV: Bloomberg, BBC
Debt crisis: live – The Telegraph
The Euro Crisis Blog – WSJ
Tracking Europe’s Debt Crisis – NYT
FX Options Analytics – Saxo Bank
European 10yr Yields and Spreads – MTS indices

Asia today: Mild risk-off bias presses currencies, stocks lowerSaxo Bank
Tight ranges from overnight ensured a steady start to the Asian session but as the session wore on we felt a distinct bias towards risk-off

Morning Briefing (Asia): Markets Tread Water Ahead of Jackson HoleBNY Mellon
The end of the dependency model in Latin America may signal a new age of investment in emerging markets 

Market Preview: German consumer confidence eyedSaxo Bank
European markets are expected to open lower Tuesday ahead of German and US consumer confidence data due later today. Meanwhile, concerns about the global economic slowdown have resurfaced after Japan lowered its economic assessment on the nation. 

Danske DailyDanske Bank (pdf) 

Morning Briefing (EU/US): Get Back BNY Mellon
The end of last week provided a number of clues as to what might happen next in the Euro-area crisis. 

AamukatsausNordea (pdf)
Saksa ja Ranska etsivät yhdessä ratkaisua velkakriisille * Euroalueen kriisi painaa Saksan taloutta * Lontoon vapaapäivä hillitsi kaupankäyntiä valuutta–, korko– ja metallimarkkinoilla 

AamukatsausTapiola (pdf)
Markkinan suunta:  Osakkeet ja hyödykkeet liikkuivat jälleen vaatimattomasti, kun markkinoilla odotetaan viikonlopun keskuspankkien puheenvuoroja Saksan IFO-indeksi jäi jälleen odotuksista, tällä kertaa odotuksia kuvaava komponentti petti. Osakefutuurit nyt aamulla miinuksella, indikoiden laskuavausta. Fortum – Tapiola Pankin TOP 5 -osake: Osakekurssi jäänyt sähkön hinnan palautumisesta. Kuinka monta Fortumin osaketta kotitalous tarvitsee sähkölaskunsa suojaamiseen?


ECB's bond purchases should start with PortugalSober Look
JP Morgan: It really can't do too much with Greece at this point, but the central bank could focus on Portugal first. Portugal is supposedly on track with its fiscal plan (at least they have satisfied the Troika requirements). Yet the low rate policy transmission is broken, as short-term rates (as well as effective household borrowing rates) remain stubbornly high.

Eurozone needs a German sovereign wealth fundFT
Daniel Gros & Thomas Mayer: Target 2 claims are ultimately backed by the securities of banks in deficit countries delivered as collateral for ECB credits under the various facilities. A large part of these securities is probably of dubious quality…(with SWF) Imbalances would gradually disappear and German foreign assets would move from zero interest nominal claims on the ECB to diversified real and nominal claims on various private and public foreign entities in a variety of asset classes.

Merkel in ChinaProject Syndicate
German Chancellor Angela Merkel’s second visit to China in a year comes against the backdrop of dire forecasts of a difficult September for the eurozone. Mindful of such concerns and persistent pessimism in global financial markets, Merkel is now taking bold initiatives at home and overseas, as her China trip demonstrates.

China's 'Ostrich' Economics: Iron Ore And Coal Set To Plunge FurtherZH
Morgan Stanley sees weak demand and overproduction pushing prices lower

People’s Bank of China injects RMB125 billion of liquidity via reverse repoASA
Asia macro: Forever blowing (housing) bubbles?Saxo Bank
Managing property bubbles has become an integral part of monetary policy in recent years as the excesses of extremely easy money over the last few years come home to roost. Here’s a brief look at how a few Asian central banks are tackling the issue and to what degree of success.

Futures Leaking As Japan Cuts Economic Assessment And Aussie Home Sales SlumpZH