EUROPE
Italian parliamentary vote, German coalition deal reflect populists'
advances, wider dissatisfaction with establishment
Faced with U.S. tax cuts, France, Germany hasten harmonization: Merkel – Reuters
Germany, France to start work on new EU projects,
says Macron – Politico
French president calls
on Germany to ‘bring the European project forward’ once new grand coalition is
in place.
We remain comfortable
with our Eurozone GDP growth forecast of 2.4% this year but the pace of growth
will slow a bit in the second half while political uncertainty will force the
ECB to tread carefully
Euro-Area Economy Looked a Little Less Buoyant
in February – BB
PMI falls, Trump’s
tariffs knock investor confidence lower * ECB Governing Council holds policy
meeting this week
EU Plans to Tax 2%-6% of Tech Giants' Sales, Le Maire Tells JDD – BB
EU Plans to Tax 2%-6% of Tech Giants' Sales, Le Maire Tells JDD – BB
The
tension between a small but vocal minority of hawks and the still large
majority of doves seems to be increasing. Next week’s ECB meeting will offer
some new insights on who is currently on top in this bird fight
GERMANY
Merkel Wins Fourth Term
as Germany’s SPD Backs Coalition – BB
German Social Democrats
back new Merkel-led coalition – Reuters
Finally a government
after SPD clears the way for Merkel’s fourth term – WaPo
Trump tariffs, China,
Macron demand German leader’s attention * Unresolved party reforms could mean
bumpy ride
Leonid Bershidsky: Merkel's Legacy Isn't Flashy,
But It's Lasting – BB
She'll leave a more
open, happier country to her successor -- likely one of her choosing.
ITALY
Berluconi’s bloc seen as
only force with chance of majority * Di Maio’s Five Star could become top
populist party in Europe
Italy Populists Break Establishment Grip In
Quest for Power – BB
Country faces stalemate
as no clear winning party or alliance * Five Star, League surge as Berlusconi,
Democratic Party falter
Italy faces political gridlock as 5-Star surges
in election – Reuters
Italy: Populism strikes back – Nordea
Populist parties
performed strongly in Italian elections, while no single coalition seems able
to reach a majority. Government formation will be difficult and new elections
cannot be excluded. Financial markets should exhibit some worries.
Italian Election Monitor: Eurosceptic shift – Danske Bank
Italian Election Monitor: Eurosceptic shift – Danske Bank
Election result appears to
be a hung parliament, as earlier polls pointed to already. Anti-establishment parties
such as the Five Star Movement and Northern League nevertheless registered
strong gains, but none of the three major political blocs seem to be able to
secure an outright majority
Italy Populists Break Establishment Grip, Quest
for Power Opens – BB
Country faces stalemate
as no clear winning party or alliance * Five Star, League surge as Berlusconi,
Democratic Party falter
Wall Street Responds: "Anti-Establishment Forces Are On Fire" – ZH
Wall Street Responds: "Anti-Establishment Forces Are On Fire" – ZH
Ferdinando Giugliano: Italy Takes a Step Back
From Europe – BB
The winners in the
country's election have promised policies that put them on a collision course
with Italy's EU partners.
Italy Populists Break Establishment Grip, Quest
for Power Opens – BB
Country faces stalemate
as no clear winning party or alliance * Five Star, League surge as Berlusconi,
Democratic Party falter
Waiting for Mattarella – Marc to
Market
There will be a great
deal of posturing and declarations, but the following yesterday's election, the
next step is in President Mattarella's hands.
Italy: what’s next and Goldman just soured on
"European and market stability" – ZH
Italy: Hung parliament, left without obvious
short-run solution to gridlock – ING
Without an outright
winner but with a populist twist in parliament, forming a new government will
be complicated. Expect tactical positioning by party leaders and clarity about
the presidents of the two Houses, before an attempt at a coalition is made
Leonid Bershidsky: Italy's Election Was Quite
Traditional, Actually – BB
The nation's voters
favor weak central governments for a reason.
EUR: Looking through Italian politics – ING
The outcome of the
Italian elections doesn't alter our bullish EUR/USD view. The hung parliament
is not enough to offset the positive Eurozone economy cyclical story and the
ECB's steps towards policy normalization
UNITED STATES
TARIFFS
Stock investors'
reaction to the president's plan creates an internal conflict.
US
hot-rolled coil prices have been trading $100/mt above Europe in anticipation
of trade duties. President Trump's announced 25% tariff will affect 30% of US
demand, a considerably lower portion than the tariff impact in aluminium. The
impact on costs for the consumer will vary by product
Trump's Steel Tariff Shakes Global Trade Order,
EU Group Warns – BB
Trump Trade Crackdown Shows ‘America First’
Happening at Last – BB
Goldman says steel
tariffs could signal trouble for Nafta *U.S. also working on investigation of
China’s IP practices
MARKETS / OTHER
BOJ's Kuroda Joins
Queue of Central Banks Looking Toward Exit – BB
Kuroda
says logical to think ahead if inflation hits target * Clearest signal yet from
Kuroda on thoughts of exit strategy
BNP Paribas: The
Trade War Playbook
– ZH
Key Points From
China Government Work Report for 2018 – BB
Global
economic growth is going from strength to strength and price pressures are
building. Yet central banks in aggregate are still ‘printing money’ and fiscal
policy is increasingly stimulative. This suggests global activity is subject to
upside risk and the potential for an old style ‘boom-bust’ cycle may be rising.
Central banks will need to tread carefully and markets should prepare for
potentially unexpectedly sharp changes in monetary policy.
US stimulus and closing output gaps pose upside risk
- Upside risks from oil prices and rising wage pressures
The diverging Phillips curves in Norway and Sweden
6 Misaligned rates and inflation markets
US inflation outperformance + comfy Fed = weaker USD
REGULARS
FirstFT Daily Briefing – FT
Steeling for trade wars, Oscars turn 90, billionaire bolt-holes
WSJ City – WSJ
Populist Surge Leaves Italy’s Immediate Future Uncertain, White House
Bats Away Tariff Warnings
WSJ Economics – WSJ
Tariffs and Trade Wars | U.S. Emerging as World’s Top Oil Producer |
Italy’s Election Leads to Uncertainty
“Best of the web” daily
charts – Lukas
Daalder
Danske Daily – Danske
Bank
Daily Market Comment – Marc
Chandler
Italian Election Weighs on Italian Assets, but Little Systemic Risk Seen
Brussels Playbook – Politico
Italy swings right — New front in Selmayrgate — Robot cartels
Five Things You Need to
Know to Start Your Day – BB
US Open – ZH
Jittery Markets Rebound From Sharp Losses, Italy Slumps On
Anti-Establishment Surge
Frontrunning – ZH
FINNISH
Mitä tekee Trump - Tuontitullit keskiössä | Italian
vaalit ennakoivat vaikeita hallitusneuvotteluita tai jopa uusia vaaleja | EKP
kokoustaa torstaina