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Monday, January 16

16th Jan - UK's "hard brexit"-threat, Trump-interview

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Politics: will Trump Bannon Europe?Nordea
Martin Enlund: In Europe, neither polls nor betting markets are consistent with similar upsets of the status-quo as was seen in 2016. However, the new US administration will have indirect & direct effects on European politics, spelling trouble for the status-quo.

Immersed in the Brussels BubblePolitico
A self-described “outsider with no experience of political reporting at all” on the EU bubble

The Difference of an A and BBB for Italy – Marc Chandler
DBRS Downgrades Italy, Raising ECB Collateral Haircuts – ZH

The A to Z of Theresa May’s Brexit as her Vision Speech Nears – BB
PM May must set out Brexit plan by mid-Feb: UK lawmakers – Reuters
UK MPs say Brexit strategy must be ready by mid-February – Politico
How Theresa May plans to reduce immigration after Brexit – Politico
May to Seek Hard Brexit by Leaving EU Market, Times Reports – BB
Britain's May to call for national unity in major Brexit speech – Reuters
Inflation on the Rise Keeps Balance Tilted Toward BOE Hike – BB

Financial Markets MonitorOffice of Financial Research
U.S. Long-Term Interest Rates Rise, But Remain Low, chart package pdf

Ben Bernanke: The Fed and fiscal policyBrookings
Because of uncertainty about the timing, size, and composition of the fiscal package, and the resulting uncertainty about its likely economic effects, Fed policymakers are, for now, sticking to their baseline forecast and treating a big fiscal program as an “upside risk.” As the outlines of the Trump administration’s fiscal policy become clear, the Fed’s projections—and its actual policy—will adjust accordingly.

Kenneth Rogoff: The Trump DeficitProject Syndicate
It is a post-financial-crisis myth that austerity-minded conservative governments always favor fiscal prudence while redistribution-oriented progressives view large deficits as the world’s biggest free lunch. This simplistic perspective badly misses the true underlying political economy of deficits.

Trump suggests he may do away with Russia sanctions if Moscow helpfulReuters

Trump Team Shunning Davos Meeting of World’s Economic EliteBB

(important interview, but press coverage of it awful)
Donald Trump: I’ll do a deal with Britain – Times
Trump: I’ll start off trusting Putin – Politico
Trump Slams NATO, Floats Russia Nuke Deal in European Interview – BB

Macro Monday: Markets await Trump inauguration – TF
This week the focus is on three key areas: UK Prime Minister Theresa May's Brexit speech Donald Trump's inauguration and China's Q4 GDP.

FX: signs of weaknessNordea
Aurelija Augulyte: A lot of talk and politics in the weak ahead. But watch key macro drivers: the US economic surprise index has finally turned lower as consumer not "great again". Beginning of the end?

Goldman: S&P +6% Since Election But EPS Forecasts Haven't Budged – ZH

A timeline of 2011, to aid your reading of the FOMC transcripts

Turkey's Lira Decline - Rooting Out The Speculators Isn't The SolutionForbes

World Economic Outlook January 2017 UpdateIMF
Blog: Update to the World Economic OutlookIMF

When the Feds Went After the Hedge-Fund Legend Steven A. Cohen
New Yorker
Inside the government’s nearly ten-year battle against one of the most powerful men on Wall Street.

Bernie Madoff is cornering the prison market on Swiss Miss hot chocolateMadoff
A new six-part series on the biggest scammer in the history

Danske DailyDanske Bank

Swedish house prices and Carney today, busy week ahead * Trump inauguration ahead * USD-EUR rate spreads subject to downside on ECB * GBP pounded as May expected to announce hard Brexit

Morning MarketsTF
The expectation that UK prime minister Theresa May will confirm a shift towards a 'hard' Brexit Tuesday has sent GBPUSD into a downward spiral with the 1.20 handle the latest consolidation point for buyers and sellers. Trump's promise that Britain heads the queue for a trade deal may not amount to much.

Euro wrap-upDaiwa
Daily Market CommentMarc Chandler
Hard Exit Talk Sent Sterling Below $1.20

Daily Press SummaryOpen Europe

Brussels PlaybookPolitico
Tumbling Pound Rattles Global Markets; Chinese Stock Slide Forces Government Intervention
FX UpdateTF
It’s white knuckle time for sterling traders as the British pound gapped lower to start trading this week after hard Brexit talk over the weekend. Prime minister May will deliver a major Brexit speech tomorrow while the BoE’s Carney is scheduled to speak today.

Johtajat äänessä * May pitää puheen hallituksen Brexit-neuvotteluja koskevista suunnitelmista * EKP pitää vuoden ensimmäisen rahapoliittisen kokouksensa * Donald Trump astuu virkaan perjantaina

Jaakko Kiander: Eurokauden kriisistä selvittiin niin kuin pitikin HS
Suomessa analysoitiin jo 1990-luvulla, millaisia vaikeuksia rahaliittoon liittyminen saattaisi aiheuttaa. Uhkakuvat nähtiin ennalta, ja niihin osattiin varautua.

Suomi 100 ja telefoni Afrikassa
Jukka Hankamäki