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Tuesday, March 19

19th Mar - US Open: Cyprus still, Fed Ahead

The Cyprus-piece has been updated, again. Let's not forget the FOMC!

Previously on MoreLiver’s:

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Roundups & Commentary
Frontrunning – ZH
Overnight: Levitation Weighed Down By CyprusZH
The Lunch Wrap – alphaville / FT
Emerging N.Y. headlines – beyondbrics / FT
Daily press summary – Open Europe

Morning MarketBeat: Markets Have to Climb a Cyprus Hill – WSJ
Dollar Firm, Anxiety Still Running High – Marc to Market
Morning Briefing (EU/US): As you were – BNY Mellon
  Mervyn King’s comments on GBP have resonated: they should not have done.

Great Graphic: Euro Area Peripheral DepositsMarc to Market

UK Budget: More Austerity not LessMarc to Market
There are two important events tomorrow in the UK in addition to the monthly jobs report: the the minutes from the recent BOE meeting and the budget.

Professor Monti and the
Who saved Italy? This column argues that the crisis began with Silvio Berlusconi and ended with Mario Monti. Evidence suggests that restoring a sense of credibility to Italian policymaking was difficult to earn but may be very easy to lose (as the recent run on Italian debt suggests). New and old Italian politicians cannot afford to underestimate the formidable challenge ahead: getting Italy out of this depression without jeopardising its credibility.

Europe, Italian-StyleProject Syndicate
The outcome of Italy’s election will most likely leave the country – the eurozone’s third-largest economy and the world’s third-largest sovereign-debt market – without a stable government. As a result, it will be difficult to sustain a reform program that is vigorous enough to satisfy the ECB and the eurozone core.

Europe’s Lost-and-Found DecadeProject Syndicate
It is unlikely that Europe’s economy will follow the pattern of emerging-market crises and rise, phoenix-like, from the ashes. But, for better or worse, the fact that the most severe political and social turbulence is yet to come at least means that Europe will be unable to afford the dithering that produced Japan’s lost decade.

The Fed’s exit will be gradual and difficultGavyn Davies / FT

Quiet revolution at the Fed spells inflationNordea (pdf)
Due to the strength of underlying fundamentals in the US economy, an elevated structural level of unemployment and the Fed credibly aiming for higher inflation we expect the US yield curve to continue steepening over the coming year or so as markets price in higher inflation (summary).

The US: Ready for lift-offNordea (pdf)
With much improved economic fundamentals and significantly diminished policy risks the stage is set for a much stronger US economy in 2013 and 2014, but not without bumps along the road (summary).

Economic Outlook – Slow turnaroundNordea (pdf)
The global economy is slowly but surely improving. Both the US and China can look forward to solid progress over the coming years, and there is hope that Japan will resurrect itself and emerge from the protracted deflationary spiral. The weak link is still the Euro zone.

New forecasts: Oil prices creep higherNordea (pdf)
We lift our Brent oil price forecast to USD 112/bbl (USD 110/bbl) in 2013E and to USD 115/bbl (USD 112/bbl) in 2014E (summary).