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Friday, December 19

19th Dec - Russia & energy still dominate

Previously on MoreLiver’s:

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Riksbank Critic Ohlsson Named Deputy Amid Deflation StruggleBB
Ohlsson, who has criticized the Riksbank for focusing too much on financial stability, was named deputy governor as the Swedish central bank struggles to meet its inflation target.

Lithuania Risks a Greek Euro TragedyView / BB

Consensus Builds Against Eurozone’s ‘Hardball’ Strategy WSJ

Rouble liquidity squeeze set to weigh on GDP growth – Danske Bank
Hollande Floats Russian Sanctions Relief in EU Split – BB
Putin Row Leaves France Holding Two Carriers It Doesn’t Need – BB
Sanctions Now Risk Being Too Painful for Russia, Denmark Says – BB
Did China Float a Bailout Offer for Crisis-Hit Russia? – BB
Russia's parliament rushes through bill boosting banking capital – Reuters
Russia’s crisis is also a huge opportunity – TradingFloor
Russian economy set to dive deep in 2015 – Danske Bank
Q&A on the Russian crisisNordea

ECB considers making weaker euro zone states bear more quantitative easing riskReuters
While the idea may help overcome opposition in Germany, which is worried that fresh money printing could encourage reckless spending and leave it to pick up the tab, critics will argue that any such conditions curtail its scope and impact.

Peter Praet: Is the ECB Doing Enough?Project Syndicate
The ECB has implemented a series of measures in response to economic sluggishness and financial trepidations in the euro area. Tentative evidence suggests that the measures are delivering tangible benefits to the European economy, and the ECB still has plenty of weapons in its arsenal should they prove necessary.

Euro inflation set to decline to -0.5% and remain negative until Q4 15Danske Bank
The continued decline in the oil price should result in negative euro inflation in December and we now forecast it will remain negative until Q4 15. This implies that average inflation should also be negative at -0.1% in 2015 (revised down from 0.4%).

30% of the Euro Area HICP basket is now in outright deflationBruegel
While inflation over a 10 year horizon was still at 1.8% in December 2013, the latest expectations revise this number downward to 1.5

What Trichet told Spanish prime minister in an Aug 2011 letterECB

Japan: a more dovish BoJ in 2015Nordea
The BoJ kept monetary policy unchanged at the last meeting this year. This was widely expected as the bank has just expanded its huge asset purchase plan 1½ months ago and the effects have yet to be seen. Looking into 2015 the BoJ is likely to become more dovish as Premier Abe will replace two retiring members with successors that share his reflationary view.

Daily Central BanksWSJ
Bank of Japan downplays Oil-Deflation Worries—For Now * Fed Gives Banks More Time to Sell Private-Equity, Hedge Fund Stakes * BOJ Stands Pat on Policy * ECB’s New Member Could Support Bond Buying

Daily MacroWSJ
In case there were any doubts about the power of the Fed and the market’s obsession with it, the past two days have wiped those away. After all the anxiety that preceded the Fed’s statement on Wednesday afternoon, the DJIA is now up more than 700 points in two days. And all because of the words “patient” and “considerable time.”

Danske DailyDanske Bank

FI Eye-Opener: Up Nordea
Yesterday: EUR up, RUB up, equities up, rates up. No Christmas present from the BoJ. Chinese statisticians found some more GDP. Today: no bond supply, few data.

The Santa Rally Underpins the Dollar Marc to Market

Daily Shot – China moves to burst its credit bubbleTradingFloor
In China, short-term rates are on the rise, even as expectations are for some variant of easing. While this could deflate the country's credit bubble, it could also inhibit growth. Elsewhere, Nigerian markets collapsed as currency trading was curbed, and crude oil implied volatility remains elevated as traders pay outsize premiums for oil puts.

Futures Continue Rising As Illiquid Market Anticipates More Volatility In Today's Quad-Witching

FX Update: USD outshone by commodity currenciesTradingFloor
The US dollar is trading stronger versus the euro, Swiss franc and the Japanese yen after the BoJ meeting overnight, but sterling and the commodity currencies are even stronger at the moment. It is time for the greenback to show who’s boss as we head into year-end?

From the floor: 'Big winner' energy rally can continueTradingFloor

Financial forecast update: No snow but more plenty of volatility around ChristmasNordea
Even though we expect long German yields to reverse course early next, yields have more room to fall in the final weeks of this year. We continue to expect the Fed to start hiking rates in June 2015 and the ECB to deliver QE in early 2015. More volatility will be in store in the coming weeks.

FX forecast update: Santa bringing volatility instead of presentsNordea
The end of the year has provided plenty of volatility, especially in Scandis. While global oil price developments recently led us to revise our EUR/NOK forecasts, we see few reasons to change our other FX forecasts for now. While we see negative krona risks stemming from the Riksbank, this is to some extent mitigated by the current valuation of the SEK. We remain USD bulls.

Oil price to bottom when non-OPEC output rise halts – déjà vu #2Danske Bank

Venäjä, Venäjä, Venäjä – antaisivat vain kelluaTyhmyri

Talouspuhetta julkisesta keskustelusta ja ensi vuoden näkymistäRaha ja Talous

Suomi: Julkisen talouden velkaantuminen jatkuuNordea
Julkisen talouden velanottotarve pysyy suurena. Valtion ja kuntien rahoitusalijäämä on vuositasolla runsaat 8 miljardia euroa.

Tie helvettiin on päällystetty hyvillä euroillaLibera
Onko Suomen etu todellakin sama kuin mitä muut euromaat tavoittelevat? Voisiko Suomi kansakuntana saavuttaa paremman lopputuloksen kohdentamalla varansa toisella tavalla?

Tie helvettiin on päällystetty hyvillä euroillaTE
Eurokriisi syntyi Saksan säästöpankkien ja ranskalaisten suurpankkien ylilyönneistäTE