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Tuesday, September 8

8th Sep - Bad data from China



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EUROPE
Euro area Economic Outlook: Still a vulnerable recovery – Nordea
We see no need to change our growth forecast for the Euro area: 1.3% for this year, 1.6% for 2016. We still expect the mainly consumption-driven recovery to go on, but not to strengthen significantly. Recently, external downside risks have increased. Inflation is likely to increase towards the end of this year, but we expect it to remain below the ECB target for the whole forecast horizon. Policy rates will remain very low and we expect the ECB will have to continue buying bonds beyond 2016.

Father of the euro fears EU superstate by the back door – The Telegraph
Professor Otmar Issing has warned against handing over control of tax and spending before a democratic political union has been established

Germany's Schaeuble Blasts Central Banks – ZH
“Money Printing Leads To Financial And Debt Crises”

Political integration has contributed to rising inequality in the Eurozone – Europp

Economic Uncertainty Weighs on the Eurozone – euinside

Who’s the Better Keynesian? Schaeuble Says He’s the One – BB

Spain's Bonds Yield Most Versus Italy in 2 Years Before Election – BB


Hollande chooses friend for central bank job – Politico


  REFUGEES
Europe Under Siege? – Project Syndicate
Refugee Crisis Reveals Total Lack of EU – euinside
Berlin threatens neighbors over migration – Politico

 
UNITED STATES
Paul Krugman: Trump Is Right on Economics – NYT
Why Paul Krugman thinks Donald Trump is right – WaPo

  FEDERAL RESERVE
Flying Mostly Blind Heading Into the September FOMC Meeting – Tim Duy
Ultimately, the Fed will need to choose between one of these two arguments, and by doing so they will define a direction for policy. This will be important new information.

Mark Thoma: Why the Fed Must Banish the 1970’s Inflation Devil Before Raising Rates – The Fiscal Times
My preference is for the Fed to wait until it actually sees clear evidence of increasing inflation before slowing the economy and, at the same time, slowing the wage growth that workers have been waiting so long to see. However, that is likely too much to ask. But the Fed should at least be patient.

Dembik Christopher: Why the Fed should hike rates in September – TF
US rate rise problematic for emerging markets * Employment, inflation likely strong enough for a Fed hike * September hike remains the most probable outcome

Martin Wolf: The case for keeping US interest rates low – FT
After nearly seven years of zero interest rates, the inflation of which critics warned is invisible

World Bank chief economist warns Fed to delay rate rise – FT
Fed should wait with raising rates: World Bank economist – Reuters

Three Charts Illustrate the Fed's Labor Market Dilemma – BB
For one thing, the historic relationship of labor market indicators such as the separation rate with wage growth appears to have broken down.


OTHER
Macro Focus – The top 6 emerging markets at risk – ABN AMRO
We have recently cut our growth forecasts for several EMs in Asia (South Korea, Taiwan, Singapore, Thailand) and Latin America (Brazil, Colombia, Chile) and expect overall EM growth to fall to around 3.5% this year (2014: 4.4%), picking up to around 4.5% in 2016.

Jim Simons Rare Interview – Market Folly
TED Talk With the Mathematician Who Cracked Wall Street

China’s trade surplus surges 40% as imports plummet – FT


REGULARS
Morning MoneyBeat Asia – WSJ
China Data’s Still Keeping Tensions High

Morning MoneyBeat Europe – WSJ
Asian Data Continues To Disappoint

Morning MoneyBeat US – WSJ
Why Small Caps Could Be Poised for Gains

Danske Daily – Danske Bank

Global Daily – ABN AMRO
Eurozone GDP growth was revised up in Q1 and Q2, painting a picture of ongoing recovery * The ECB’s QE and measures to repair the credit channel have contributed to this picture * China trade continues to shrink – authorities likely to allow further moderate CNY weakness

Euro rates update – Nordea

Eye-Opener – Nordea
Asian equity markets mostly down, slightly stronger EUR * Chinese imports decline faster than expected * General risk appetite still important for bond markets * GBP recouping some of its earlier losses

Morning Markets – TF
It's a data-dependent Tuesday as fresh releases from the Eurozone (GDP) and the US (small business optimism, labour market conditions) make their way towards an anxious market.

Daily FX Comment – Marc Chandler
Ten Things that Happened on the US Labor Day

Daily Shot – TF
Stock markets are declining in Asia and money is repatriating from emerging markets. This could keep upward pressure on the USD.

Daily Press Summary – Open Europe
Hollande confirms France will accept 24,000 refugees as part of EU ‘burden sharing’ plan *
Government suffers defeat as full purdah rules to apply to EU referendum * Tsipras raises prospect of coalition with PASOK and To Potami * France to prepare for airstrikes on Syria, Italy opposed * John Longworth: The EU is moving away from British business * EU to grant farmers €500m to compensate for falling prices * Gazprom holds first spot gas auction in Europe in concession to EU

Brussels Playbook – Politico
Parliament power play — Trilogue dialogue — Farm protest pays off

US Open – ZH
Futures Soar After Dramatic Chinese Last Hour Intervention Scrambles To Mask Latest Terrible Trade Data

Frontrunning – ZH

FX Update – TF
Another day of watching and wondering whether risk sentiment can get its act together as we watch the USD super-majors drift around without conviction. Plenty at stake this week, however, for CAD and NZD ahead of interesting central bank meetings.

From the Floor – TF
Fresh trade data from China stokes fears about the slowdown in the world's second-largest economy, dealing another blow to Asian equity markets and crude oil and spurring buying of euros.


FINNISH
Aamukatsaus – Nordea
Suomen viennillä reilusti petrattavaa * Kiinasta surkeat ulkomaankauppaluvut * Saksan teollisuustuotanto jäi heinäkuussa hieman odotuksista * Sijoittajien luottamusta kuvaava Sentix-indeksi heikkeni syyskuussa

Pakolaiskriisi, kannustimet ja salakuljettajat – Roger Wessman

Lomia, ylityökorvauksia ja sunnuntailisiä leikataan – YLE
Tulevaisuudessa ensimmäinen sairauspäivä olisi palkaton ja sunnuntailisät pienenisivät sadasta prosentista 75 prosenttiin.


Hallituksen esitykset toimista kustannuskilpailukyvyn parantamiseksi – Valtioneuvosto