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Wednesday, May 30

30th May - Modest calm in Italy

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Parallel Currency - Revisiting Justified?Klaus Kastner
Before the introduction of the Euro, every country had a parallel currency. It was called 'local currency'.

Spain snap elections in sightPictet
Political instability in Spain has added to turmoil in peripheral euro area countries.

ECB's Whatever-It-Takes Toolbox Means Italy Has to Blink FirstBB
The ECB of 2018 is far more powerful than in the 2012 crisis * Central bank’s biggest backstop tool comes with conditions

European Lenders Brace for Change at the ECBBB
SSM chair and vice chair are among departures at start of 2019 * Shakeup comes just as supervisors have to deal with Brexit

Editorial: What Europe Should Do About Italy BB
The EU needs to show flexibility and restraint.

Italy's Establishment Faces Populist Push With No ChampionBB
League, Five Star are polling close to combined 60 percent * Pro-European parties are in retreat since March’s election

Commentary: The EU’s Italian nightmareReuters

Politicians push for July election as Italy seeks exit from crisisReuters

The Italian market panic - drivers and near-term outlookDanske Bank
The Italian bond sell-off reached unprecedented levels yesterday and is starting to have significant global ramifications as we saw during the euro debt crisis in 2012. 

Jan von Gerich: Loss of market access would have dire consequencesNordea
A loss of market access would force Italy to ask for outside help or start printing its own currency. Both would be very problematic scenarios. In any case, Euro-area break-up fears would balloon and markets would go into a crisis mode.

Italy Bonds Pass Auction Test in a Sign of Easing Market JittersBB
Both five- and 10-year sales oversubscribed, but pricing mixed * Political risk is still a ‘thick fog:’ ADM Investor Services

Italy Needed a Bond Victory. It Got a Whimper BB
Wednesday’s auction was at best a mixed bag.

FAQ:  What Happened to Rome? Marc Chandler

Lucrezia Reichlin: What Italy’s Crisis Means for EuropeProject Syndicate
Though Euroskeptics have failed to form a new Italian government, both Italy and the European Union are entering a new phase of deep uncertainty. In the absence of a robust growth agenda that addresses Italy's structural economic weaknesses, another euro crisis could be in the offing – and this one would be far worse than the last.

Italy Heads for Confrontation with Itself, Financial Markets, and EuropePIIE
President Sergio Mattarella has put Italy on a path of political confrontation domestically and most likely with financial markets and the rest of Europe.

Italian debt under fire Pictet
Risk of contagion from the volatile Italian bond market leading us to become bearish on euro peripheral debt.

PIMCO:  Short Italian Bonds, ECB Sees "No Need" To Intervene In ItalyZH

Euro Spikes, Italian Yields Slide After 5-Star Calls On Savona To Withdraw CandidacyZH

For Italian Bonds, These Are The 12 Charts That Matter The Most ZH

Goldman Admits It Has No Idea What Happens Next In ItalyZH

The Euro: Only as strong as its weakest linkING
The Italian political crisis has heaped more pressure on EUR/USD and has re-introduced the topic of a Eurozone crisis onto the FX risk map. While we cannot now rule out EUR/USD falling to the 1.10/12 area this summer, we would say that current EUR pricing already includes a substantial 4% political risk premium

EU Open RundownRANsquawk

Market Briefing: Daily Markets OverviewYardeni Research

FirstFT Daily BriefingFT
Italy crisis, trade war rebooted, Sorrell’s return

The Early Winner from Italy’s Political Chaos, U.S. Jeopardizes Trade Talks with China

WSJ EconomicsWSJ
U.S. Threatens Tariffs, Italy Rattles Markets

“Best of the web” daily chartsLukas Daalder

Danske DailyDanske Bank

Daily Market Comment Marc Chandler
Italian Reprieve, Euro Bounces, Trade Tensions Rise

Brussels PlaybookPolitico
Budget scoop — Oettinger unleashed — Parliament’s (rap) battle

Five Things You Need to Know to Start Your DayBB

Global Stocks, US Futures Rebound As Italian Bond Panic Eases; Euro Jumps

Aamukatsaus Nordea
Italian korot rajussa nousussa, Saksan korot laskivat, pörssit punaisella | Espanjan ja Saksan inflaatioluvut luovat tunnelmia euroalueen inflaatiolle | Euro heikentyi dollaria vastaan