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EUROPE
Spain:
Higher domestic demand and improved competitiveness – Danske
Bank
Is
pessimism about European debt levels justified? – Mainly
Macro
Jakobsen:
Growth in Eurozone looks like a 'total loss' for 2014 – TradingFloor
Eurozone
GDP figures are out on Thursday and with industrial production in Germany, France and Italy down, the signs aren’t good. The
prediction is for 0.1% growth but Saxo’s Steen Jakobsen warns we could see a
negative number.
Italian
growth: New recession or six-year decline? – voxeu.org
The Italian
economy slipped back into recession in the first part of 2014. This column
argues that this characterisation is based on a criterion for a recession
standard in most of Europe – two successive quarters of negative growth.
However, there are other commonly applied criteria to define a recession. US
standards, for example, would treat Italy’s economic situation as one, six-year-long
recession. Whereas one cannot say whether one criterion is superior to the
other, announcing a recession has further impact on the economic activity in
the respective country.
Break-even
rates for bonds weigh on EUR – TradingFloor
The ECB is
likely to go for 'extraordinary measures' * US and German bonds have different
breakeven rates * QE likely to kick off after ECB stress test results released
Putin’s
Dilemma – Project
Syndicate
The West's
sanctions on Russia are already having a powerful
effect, and the expectation that they will be tightened further is a huge
concern for investors and the Russian government. And, though some Russians
dream of autarky, the need to maintain living standards – the foundation of
Putin’s domestic support – rules it out.
UNITED STATES
BofA
Warns "Wealth Effect" Spending Muted, Consumers Cautious – ZH
US loan
growth rate the highest since the recession – Sober
Look
Fed Exit
Fears Overstated, S&P Economist Says – WSJ
ASIA
What
Chinese financial repression looks like – Humble
Student
5 Things
to Watch in Japan’s GDP – WSJ
Is the
Australian model in trouble? – FT
Officially,
Australia has avoided recession for more than two
decades — an impressive achievement for a small open economy…the newest data
suggest that Oz’s luck is beginning to change.
OTHER
Daily
Central Banks – WSJ
Hannon’s
Take: BOE’s Patience on Rates May Be a Virtue * Decline in ‘Slack’ Helps Fed
Gauge Recovery * Fed’s Fischer Skeptical U.S. Growth Slowdown is Permanent *
How China’s Trying to Boost Its Economy: ‘Qualitative Easing’ * Central Banker
Says India ‘on Course’ to Meet Inflation Targets
Daily
Macro – WSJ
It’s not
clear that the trio of geopolitical tensions on everyone’s mind – the
Russia-Ukraine conflict, the Israeli-Palestinian conflict and the battles in
Iraq – have been the main drivers of market sentiment or just the trigger for
investors to exit risk assets. There also are concerns about weaker economic
data in China and Germany, the world’s second- and fourth-biggest economies,
respectively, and the ongoing risk that in midst of all this uncertainty the
Federal Reserve might yet signal plans to expedite rate increases.
What
Matters for Global Markets in the Week Ahead – WSJ
The Week
Ahead: Hard times as fear eclipses greed – TradingFloor
Patrick
Butler: Investors scramble for the exit as geopolitics takes its toll * Russia's sanctions to hit EU food
producers hard * Eurozone economy is already extremely fragile
Quiet
Start to a Quiet Week
– Marc
to Market
That
high yield question
– FT
BofAML: “investors
have capitulated out of HY bonds and that now is a good time to add exposure to
an asset class still expected to deliver 7 – 8 per cent total returns in 2014”.
But RBS says don’t do it.
Great
Graphic: Growing Currency Mismatch? – Marc
to Market
Emerging
markets have steadily increased borrowing in foreign currencies, primarily, but
not exclusively US dollars. Fed
tapering and the prospects of a rate hike toward the middle of 2015 has not
slowed this foreign currency borrowing binge.
This mismatch may save funding costs in the short-term, but if the
dollar rises, this mismatch can turn into an
Achilles' Heel quickly.
Weekly:
BoE/UK economy and the GBP – Macro
Credit FX
What We
are Likely to Learn in the Coming Days – Marc
to Market
Much of the
data due out in the coming days will
flesh out details of what is generally understood in broad strokes. This is especially true of Japan and euro
zone's first estimates of Q2 GDP.
FINNISH
Euron hajoaminen – vain jos poliittinen johto vaihtuu
kuten 1930-luvulla – Tyhmyri
Luottoluokittajat pelkkiä viestintuojia eurokriisissä
– Roger
Wessman
Suomen taloudessa ei ole työvoiman tarjontaongelmaa –
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