MoreLiver's Daily: 23rd Jan - Markets still adjusting to ECB's QE

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EUROPE

Much Too Responsible – Krugman / NYT

The thing that strikes me about Europe’s archons of austerity, its doyens of deflation, is their self-indulgence. They felt comfortable, emotionally and politically, demanding sacrifice (from other people) at a time when the world needed more spending. They were all too eager to ignore the evidence that they were wrong.

Guest post: Europe – what a state we are in – FT

Timothy Ash: While we all enjoy the ECB-inspired feeding frenzy across all risk assets this week it might be well to remember why Mario Draghi opted for yet another extraordinary measure in line with the message that he will do “whatever it takes”. Indeed, it is perhaps a reflection of the immense challenges facing Europe that he is betting the bank and, especially, other peoples’ (Germans’) money. Europe is in the worst state it has been in at any point in the entire post WWII era.

Greek choices after the elections – Bruegel

There is a chance for an agreement between the new Greek government and euro-area partners with both sides claiming victory at home

EUROPEAN CENTRAL BANK

How Super Was Mario? (Wonkish) – Krugman / NYT

ECB's bazooka in detail and market implications – Danske Bank

Mario Draghi's latest (and last) stunt? – Merkelnomics

Confidence and the Bazooka – Francesco Saraceno

George Magnus: ECB's last throw of the dice – Nikkei Review

James Saft: ECB QE, small but imperfectly formed – IFR

Results of the Q1 2015 ECB Survey of Professional Forecasters – ECB

UNITED STATES

FOMC preview: Fed to stick to mid-2015 hike scenario – Nordea

Will the Fed turn more dovish next week? For financial market participants, the answer seems to be a clear yes. We, however, don’t think so. Both falling oil prices and the ECB’s new bold QE programme strengthen, rather than weaken, the case for lift-off in Fed rates later this year, in our view. The Fed will probably applaud the ECB’s move, even if it implies further strengthening of the USD.

REGULARS

Daily Central Banks – WSJ

Hilsenrath’s Take: On Day One of ECB QE, Draghi Gets Much of What He Wanted * ECB Unveils Stimulus to Boost Economy * Why Should Americans Care About ECB Policy Moves? * Denmark Cuts Main Interest Rate Again * Eurozone PMI Data Show Pickup in Activity

Daily Macro – WSJ

Equities and bonds continued to rally while the euro tumbled yet further. If there’s a worm in the apple, it’s that the ECB’s policy won’t be reinforced by a fiscal spending program as Abenomics has been in Japan, while necessary economic restructuring continues to move slowly in the single-currency region.

Danske Daily – Danske Bank

Eye-Opener – Nordea

The day the ECB delivered Inflation expectations finally rebounding EUR/USD in free fall

ECB Drives Markets – Marc to Market

http://www.marctomarket.com/2015/01/ecb-drives-markets.html

US Open – ZH

Euro Crash Continues Sending Stocks Higher, Yields To Record Lows; Crude Stabilizes On New King's Comments

FX Update: How low can the euro go? – TradingFloor

It seems the only question now is how low can the euro go after Draghi’s bazooka was rolled out yesterday and duly impressed the market. We may actually find near-term support soon as the market ponders next Wednesday’s FOMC risks.

OTHER

FX forecast update: ECB cements Japanese pricing of the EUR – Nordea

The final delivery of an aggressive QE program from the ECB should keep the EUR on the back foot for the foreseeable future. The market’s confidence in the USD will be tested in coming months, but in the end we think the USD will remain the cleanest shirt in the laundry. We now call for parity.

PURCHASING MANAGER INDICES

Markit / JMMA Flash Japan Manufacturing PMI

HSBC Flash China Manufacturing PMI

China: signs of stabilisation in HSBC manufacturing PMI – Danske Bank

China: steady PMI indicates growth stabilisation – Nordea

Markit Flash France Composite PMI

Markit Flash Germany Composite PMI

Markit Flash Eurozone Composite PMI

Markit Flash US Manufacturing PMI

FINNISH

Aamukatsaus – Nordea

EKP:ltä uskottava paketti | Tänään luvassa euroalueen PMI | Tanskan keskuspankki laski jälleen talletuskorkoa