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EUROPE
This could tell us that
Berlin, perhaps more so than Athens, is unprepared for monetary union
Renzi has voiced
criticism of EU decision-making in recent months in relation to both the migration
crisis and fiscal policy rules. Although Renzi’s European policy is partly
rooted in seeing off the challenge of Eurosceptic parties within Italy, he is
also intent on playing a more assertive role at the European level as a
counterweight to German influence.
UNITED STATES
June Fades Away – Tim
Duy
The Fed breathed a sigh
of relief after financial markets stabilized. That opened up the possibility
that June would still be on the table, leaving them the option for three rate
hikes this year. I don't think that policymakers will abandon June as easily as
financial market participants. My sense is that they will remain coy, implying
odds closer to 50-50. But the data are not in their favor.
OTHER
It's worth being aware
of what is on the other side of their trade/investment. If you are long what
are the arguments for the shorts do they hold merit and are the odds of those
arguments being right increasing or decreasing?
The Chinese economy and
markets seem to enjoy a moment of calmness at the moment. Our concern is that
the stabilisation is only temporary as it is mostly due to policy easing,
Growth headwinds remain strong, so the economy will likely slide further this
year. The CNY may have stayed stable vs the USD but it has weakened sharply vs
a currency basket. The lack of a clear FX policy adds to uncertainty and
depreciation pressure, especially if things start to go south again.
Monetary finance – or
"helicopter drops" of newly printed cash – is the one policy that
will always stimulate nominal demand, even when other policies, such as
debt-financed fiscal deficits or negative interest rates, are ineffective. And
there is no reason why rules cannot be devised to mitigate the political risk
of excessive use.
REGULARS
Reviewing US payrolls, important
week for Scandi central banks * Scandi inflation data week
Positive details within
disappointing US payrolls * EURUSD moving sideways
China's April trade data has
derailed hopes that the world's second largest economy might be back on track
and oil reacts to the latest machinations in the Saudi corridors of power.
Monday morning bullet points
Cameron lays out defence
and security case for staying in the EU * Osborne warns Brexit would hit house
prices as Gove says Britain should leave the Single Market * Erdogan pours cold
water on migrant deal as European leaders search for alternatives * Greek
parliament passes controversial tax and pension reforms ahead of today’s
Eurogroup meeting * New poll highlights appetite for EU referendums in other
member states * Polish opposition holds anti-government, pro-EU march in Warsaw
* German Vice Chancellor denies he’s quitting as support for his party slumps
Greece — Calenda’s
U-turn — Trump trauma
US Futures, Europe Stocks Jump On
Oil, USDJPY Surge; Ignore Poor China Data, Iron Ore Plunge
The US dollar made a
stand last week just after the dollar index had crossed below key support stretching
back to 2014. But with a lack of interesting US event risks this week can the
USD follow through higher still?
This weekend's soft Chinese trade
data are weigh heavily on risk sentiment but Saxo FX head John Hardy says the
greenback is at a "technically interesting" level. So we might add
are global politics as populist currents threaten the current order in nation
after nation.
FINLAND
& FINNISH
Britannian
EU-jäsenyyden aiheuttama epävarmuus kasvussa * Uusia työpaikkoja syntyi USA:ssa
odotuksia vähemmän * Kiinan huhtikuun vienti- ja tuontiluvut olivat pettymys *
Dollari piti pintansa työllisyyspettymyksestä huolimatta