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Thursday, November 5

5th Nov - Everyone but Fed scared



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EUROPE
Autumn 2015 European Economic ForecastEuropean Commission
EU Cuts Growth and Inflation Outlook as ECB Decision Looms BB

Charles Grant: 25 years on: How the euro's architects erredCER
A quarter of a century after the euro’s conception, the flaws in its design have become apparent. EU leaders have fixed some of them but the euro needs better policies in order to be a successful currency.

How to tackle Europe’s non-performing loan problemvox
This column explores the channels through which persistently high non-performing loans hold down credit growth and economic activity. A survey of EU authorities and banks reveals that the loans are not written-off for a variety of deep-seated reasons, including legal and tax code issues. An agenda is proposed comprising tightened bank supervision, structural bankruptcy reforms, and the development of markets for distressed assets.

The lost Juncker performance reviewPolitico
Some successes, a few whoppers and plenty of room for improvement.

  EUROPEAN CENTRAL BANK
Understanding Inflation Dynamics and Monetary Policy in a Low Inflation EnvironmentECB
Vítor Constâncio, VP of ECB at “Challenges for Macroeconomic Policy in a Low Inflation Environment”-conference

Economic Bulletin 7/2015ECB
Trade links between the euro area and China * Explaining the drivers of the recent increase in oil price volatility * An assessment of recent euro area consumption growth * New data on loans to the private sector adjusted for sales and securitization * The creation of a European Fiscal Board * The transmission of the ECB’s recent non-standard monetary policy measures * The short-term fiscal implications of structural reforms

Is Europe's Economy So Bad the ECB Will Run Out of Things to Buy? BB
Some argue that if the central bank needs to ramp up asset purchases to further spur growth, there may not be enough out there. Unless they change the rules.

  UNITED KINGDOM
Bank of England sees little inflation pick-up, markets push back rate bets – Reuters
Carney Signals Bank of England Rate Can Stay Low as China Drags – BB
Strong GBP a concern, buys time before the December meeting– Danske Bank

Britain's EU reform wishlist to be unveiled next week – minister – Reuters


UNITED STATES
  EMPLOYMENT REPORT PREVIEWS
Preview: Employment Report for October – Bill McBride
US jobs report preview: more support for December lift-off – Nordea
5 Things to Watch in the October Jobs Report  - WSJ

  FEDERAL RESERVE
What 2016 Might BringTim Duy
Assuming growth is not yet softening, a 25bp rate hike every other meeting beginning in December is also a reasonable baseline for monetary policy; if the Fed doesn't see that having an impact, they will likely step up the pace. It should go without saying that a slowing economy is not to be equated with a recession. 

Feeling ignored, Fed jolts markets to prime them for lift-offReuters

FOMC's Yellen, Dudley: December Meeting is "Live"Bill McBride

U.S. productivity rises in the third quarter, manufacturing strong – Reuters
Unit Labor Costs Miss For 3rd Quarter In A Row – ZH


OTHER
Deflation Risks May Warrant Radical New Central-Bank Thinking, the IMF’s Chief Economist Says WSJ

I'll eat my hat if we are anywhere near a global recessionThe Telegraph
The fiscal spigot is opening in the US, China and Europe, and the world's money growth is near a 25-year high

Economy 2016: Here’s What You Need to KnowBB


REGULARS
Morning MoneyBeat AsiaWSJ
U.S. Stocks Ease as Yellen Calls December ‘Live’

Morning MoneyBeat EuropeWSJ
Don’t Expect Fireworks

Morning MoneyBeat USWSJ
Another Worry for the Stock Market

Danske DailyDanske Bank

Global DailyABN AMRO
US data released on Wednesday show that economy has started to shrug off the impact of the earlier financial stress * US dollar strengthens as expectations for rate hike increase * But stronger dollar leads to a renewed tightening of financial conditions

Euro rates updateNordea

Eye-OpenerNordea
Yellen still supports December Fed hike; higher yields; stronger USD * Today focus on Bank of England and Norges Bank * Draghi reiterates his stance, erasing confusion * The USD strengthens on ADP

Morning MarketsTF
Bank of England governor Mark Carney takes centre stage Thursday and with data starting to solidify, and the noises coming out of the US getting ever louder, will he single out February for a likely timeline?

Daily FX Comment – Marc Chandler

Daily ShotTF
US Federal Reserve chairman Janet Yellen delivered a clearly hawkish testimony to Congress, putting a December Fed rate increase more squarely on the table, and the market now sees the chances of a hike at 58%.

Daily Press SummaryOpen Europe
Irish think tank warns Brexit could reduce UK-Irish trade by 20% * Handelsblatt: “Berlin and Brussels should cooperate with the UK” on EU reform * France to ‘temporarily’ shut down its borders as Sweden demands relocation of its refugees * Downing Street denies rowing back on plans to restrict EU migrants’ access to benefits * EU Single Market Commissioner: new powers needed to supervise national car registration authorities * Conservative peer calls for equal spending limits for both sides in EU referendum campaign * Morgan Stanley: ‘Brexit’ would see UK growth sink to 1% * European Commission backs Uber and other ‘sharing economy’ services * UK and other member states block MEPs access to documents concerning multinationals’ tax * German industry orders on longest losing streak since 2011

Brussels PlaybookPolitico
Sweden shuts — Romanian resignation — Data drama

US OpenZH
S&P Futures Spike Back Over 2100 On Central Banks, Yen Carry Levitation, China Bull Market

FrontrunningZH

FX UpdateTF
Sterling is in focus on today’s “Super Thursday”, featuring a BoE meeting and quarterly inflation report where the bar is rather high for a hawkish surprise. This leaves interesting two-way risks for GBPUSD in particular, given the strong USD backdrop before Friday's US nonfarm payrolls.

From the FloorTF
The stubborn data have, to all appearances, been whipped into line with the services sector and payrolls coming in strong enough to raise the chances of a December rate hike significantly.


FINNISH
AamukatsausNordea
Fed nostaa joulukuussa - Yellen puhui eilen valtionlainakorot nousuun * USA:n palvelusektorin luottamus lupaa hyvää työvoiman kysynnälle * Norjan keskuspankki jättää korot tänään ennalleen