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Wednesday, June 3

3rd Jun - ECB-meeting fails to stop EUR and bonds

Previously on MoreLiver’s:

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Macropru in the Eurozonevox
There is a broad consensus that financial supervision ought to include a macroprudential perspective that focuses on the stability of the entire financial system. This column presents and critically evaluates the newly-created macroprudential framework in the euro area, with a particular focus on Germany. It argues that, while based on the right principles, the EU framework grants supervisors a high degree of discretion that entails the risk of limited commitment and excessive fine-tuning. Further, monetary policy should not ignore financial stability considerations and expect macroprudential policy to do the job alone.

Europe’s Pointless Deficit Targets? Project Syndicate
The fiscal rules of the EU have undergone much-needed improvements in recent years, but much more needs to be done. In addition to suffering from a lack of clarity on key issues, EU fiscal policy remains overly focused on short-term goals, reflected in its needless emphasis on nominal deficit targets within annual budget cycles.

EZ macro 2: Output gap will close quickly - implications for the ECBDanske Bank

Why Greece might still choose to leave the euro – FT
Oh dear, Professor Sinn...... – Frances Coppola
Tsipras heads to Brussels as talks quicken – Politico

ECB to press case for steady QE, may urge Greece to accept deal – Reuters
Draghi To Address Bond Rout, Inflation, Greece, QE Outlook – ZH

Introductory Statement – ECB
Eurosystem staff macroeconomic projections for the euro area – ECB

5 Highlights of Mario Draghi’s June Presser – WSJ
ECB Cautiously Optimistic that Worst is Behind EMU – Marc Chandler
Draghi: ECB could step up QE if necessary – ABN AMRO
ECB meeting: no new signals - bond sell-off continues – Danske Bank
Bunds and Euro Tied at the Hip? – Marc Chandler
Mario Draghi Pushes Bunds Out of Bed – WSJ
ECB meeting - Taper tempering – Carsten Brzeski

Euro area unemployment rate at 11.1% - Eurostat
Volume of retail trade up by 0.7% in euro area – Eurostat
Euro data wrap: plenty of good news – Berenberg
Euro area retail sales bounce back while unemployment drops – TF

ISM non-manufacturing misses, drops to 13-month low in May – TF
ISM Non-Manufacturing Index decreased to 55.7% in May - Bill McBride
ISM Services Plunges To 13 Month Lows As Post-Weather Bounceback Fades – ZH
Trade Deficit Shrinks 19% In April Driven By Drop In Imports – ZH


Daily Central BanksWSJ
Hilsenrath’s Take: Readers Sound Off About Consumer Spending Sluggishness * Fed’s Brainard: More Economic Progress Needed Before Rates Rise * Five Key Points to Watch in the ECB’s June Presser * BOJ Shirai: Probability of Considering Extra Easing Is Low for Now * Hungary’s Central Bank Forces Lenders to Fund Government

Daily MacroWSJ
With Greece’s deposit-hemorrhaging banks on life support, a European Central Bank meeting Wednesday that would normally be focused on broad monetary policy matters will likely revolve around how to handle the financial crisis in that country as a deadline for it to pay the IMF looms.

Morning MoneyBeat AsiaWSJ
Morning MoneyBeat USWSJ

Danske DailyDanske Bank

Global DailyABN AMRO
Jump in eurozone core inflation pushed up government bond yields and the euro * We expect the ECB to cool exit talk on Wednesday, but tone could change early in 2016 * Eurozone SMEs see rising availability of external finance adding strengthening outlook

Euro rates updateNordea

Rates sell off more, but market sceptical on Euro-area inflation: the euro strengthens, today the ECB * Greece: Are two plans better than one? * US April trade balance to stabilise

Morning MarketsTF
The Eurozone is once again the epicentre of FX market focus as the bank's governing body convenes for its latest monetary policy decision. Elsewhere, the Eurozone's retail sales numbers are expected to pass the test regarding a rebound but it will be a close call. Across the Atlantic, US reports on employment and the services sector will be closely read for guidance ahead of this Friday's jobs report.

Daily FX CommentMarc Chandler
Getting Blood from a Turnip: Potential Greek Deal Overshadows ECB Meeting

Daily ShotTF
The Eurozone seems to be the epicenter of global market volatility, sending shock waves through the fixed income markets.

Daily Press SummaryOpen Europe

Brussels PlaybookPolitico

Futures Rise, Bund Rout Pauses On "Cautious Optimism" Ahead Of Greek Endgame

FX UpdateTF
Heavy positioning has aggravated the squeeze higher in euro pairs, but the main culprit may be the aggravated selloff in European sovereign bond markets. Draghi will want to impress the market with very strong rhetoric and possibly action today as sovereign market instability is totally unacceptable for the ECB and its QE programme.

From the FloorTF
The sharp spike in bond yields of the last 48 hours, a risk-off mode in equities and a strengthening EURUSD are exactly the reverse of what the European Central Bank had hoped for when it unleashed its quantitative easing bazooka. Will president Mario Draghi unleash the full power of 'front-loading' today?

Vaalien jälkeinen helpotus liukenee Briteissä | Euroalueen inflaatio odotuksia korkeampi | Korot nousivat USA:ssa ja Euroopassa

Henri Myllyniemi: Hallitus leikkaa ja muut kitiseeUS

Kaksi kovaa keinoa iskeä ay-liikkeeseenTalSa
Uudella hallituksella on monta kikkaa, joilla se voi nakertaa ammattiyhdistysliikkeen voimaa. Taloussanomat kysyi asiantuntijoilta, mikä satuttaisi ay-liikettä eniten.

Jan Hurri: Suomen piilovelka kasvaa jo Kreikan malliinTalSa
Suomessa tuskin on aihetta epäillä samanlaista valtion velkatilastojen vääristelyä kuin Kreikassa ennen kriisiä. Silti Suomenkin valtion velkavastuut kasvavat jo täyttä häkää Kreikan malliin – valtion taseen ja virallisten velkatilastojen ulkopuolella.