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EUROPE
Fighting deflation with unconventional fiscal
policy – vox
Such policies aim to
increase growth and inflation in a budget-neutral fashion, while keeping the
tax burden on households constant.
Euro area credit growth slowed in March, but Q1
very strong overall – Pictet
BRITAIN
UK economy loses pace ahead of Brexit vote - Q1
GDP review – Nordea
The UK economy posted in
Q1 the weakest quarterly expansion in more than three years, likely at least
partly reflecting increased concerns about the outcome of the forthcoming vote
on EU membership. However, we continue to expect growth to catch up in the
second half of the year, assuming the UK remains part of the EU. Against this
background, we continue to expect the first BoE rate hike in Q4 2016.
Can Brexit Betting Odds Tell Us Something About
the Pound? – WSJ
Gamblers have upped the
stakes in favor of the U.K. staying in the EU, suggesting odds offered by
bookies could be a better guide for investors from now on
U.K. Would Suffer Economic Hit From Brexit, OECD
Says – BB
The best outcome under
Brexit is worse than remaining in EU * U.K. GDP would be 5% lower by 2030 under
Brexit scenario
PIIGS
Eurogroup and IMF Have
Come Closer to Agreement on Greek Debt – euinside
Eurogroup delay on
Greece may not be deathblow – Politico
Brussels Briefing:
Eurogroup grope – FT
EU's Tusk urges
Eurogroup to set date for Greece talks within days – Reuters
Spain to hold re-run
elections – will anything change? – Open
Europe
UNITED STATES
5 Things to Watch in the First-Quarter GDP Report – WSJ
FEDERAL
RESERVE
Fed Policy Statement – FED
FOMC Statement
Demonstrates Firm Grasp of the Obvious – Marc
Chandler
Removes "Global
Risk" But Keeps Monitoring "Global Developments" – ZH
Redacted Version of the
April 2016 FOMC Statement – David
Merkel
How the April Statement
Changed from March – WSJ
Key Take Aways:
"Fed Leaves Door Open For June Rate Hike" – ZH
See Markets React to the
Fed in 7 Charts – WSJ
OTHER
What is the BOJ Going to Do? – Marc Chandler
Great Graphic: Measuring Cost of Extend and
Pretend – Marc
Chandler
Reinhart argues that the
writing off of private debt accumulated during the expansion years is an
integral part of resolving financial crises.
Rather than seek greater international coordination (e.g., IMF and G20)
or large-scale public investment (e.g., Summers, Stiglitz, Krugman), Reinhart
argues that what is ultimately holding back the a more robust recovery is the
"extend and pretend" practices.
China's Plan to Clear Bad Loans Could Backfire,
IMF Staff Warn – BB
Converting debt to
equity may keep alive `zombie' firms * Plan may create conflict of interests
for bankers, report says
Australian Consumer Prices Unexpectedly Fall – BB
Headline CPI in
deflation, annual core inflation at record low * Currency drops almost
one-and-half U.S. cents after release
EM FX: Recovery in tandem with commodity prices – Nordea
Emerging currencies
continue to recover in tandem with commodity prices. Commodity exporters such
as the RUB, the BRL and the ZAR have performed best this year against the USD,
while commodity importers such as the INR, the CNY and the TRY have performed
worst. The BRL is over performing as markets cheer for a new president that may
not change much; the PLN is succumbing to political risks; while the RUB will continue
to ignore all other factors than oil – even a potential rate cut this week.
Falling output and
weaker dollar push oil to 2016 high – Reuters
REGULARS
Danske Daily – Danske
Bank
Euro rates update – Nordea
Eye-Opener – Nordea
Oil prices at 5-month high * More
easing from the BoJ? * Fed to open the door for a June rate hike? * Weak data
undermined the USD ahead of the Fed * GBP advances as fears of Brexit abate
Morning Markets – TF
Japan's Nikkei index was hit by
ripple effects from disappointing second-quarter results from US technology
giant Apple where iPhone sales dropped and topline and earnings figures missed
analysts' expectations. Apple's poor results reported after the US market
closed on Tuesday knocked shares in Japanese supplier companies on Wednesday.
Shockingly weak CPI data from Australia hit the Aussie dollar.
Euro wrap-up – Daiwa
Daily Market Comment –
Marc
Chandler
Two Issues Loom Large Today: Soft
Australia CPI and FOMC
Daily Market Comment
– Macro Man
Fed roulette
Daily Market Comment
– Polemic’s
Pains
The Widow Maker.
Daily Shot – TF
The great slowdown has
been replaced by a great wall of stimulus from Beijing but as with all such
efforts the rallies risk obscuring the need for fundamental reform.
Daily Press Summary – Open
Europe
Brexit would cost
Britons a month’s salary by 2020 says OECD – while Cruz says Britain would be
at “front of the line” for US-FTA after leaving * Migration underestimated by
50,000 a year * Spain set to hold re-run elections on 26 June * UK fined £650m
over past decade for misspending EU funds * Commercial property companies warn
of negative impact of Brexit on investment * Tsipras set to call for EU summit
as Greece and creditors once again at impasse over bailout talks
Brussels Playbook – Politico
Greece stumbles — Trump
soars — Poland’s Tusk problem
US Open – ZH
Futures Ignore Apple Plunge; Oil
Rises Above $45 As Fed Announcement Looms
Frontrunning – ZH
The Aussie was pummeled
for heavy losses on a huge CPI miss that will require an RBA response. A torrid
10-ish hours await markets later today and overnight as the FOMC RBNZ and BoJ
will all make public their latest policy intentions.
Surprisingly weak CPI
data from Australia overnight knocked the Aussie dollar sharply lower and
raised the prospect of a rate cut at the central bank's meeting next week. Asian
equity markets meanwhile were rattled by weaker-than-expected results from US
cellphone and computer maker Apple.
FINLAND & FINNISH
Fed
pysyy tarkkailuasemissa * Realin ralli on liian railakasta * Britannian
talouskasvu sinnittelee kohtuullisena kotimaisen kysynnän tuella * EKP
julkaisee tiedot euroalueen luotonannon kasvusta
Ikuiset asuntolainat eivät
selitä Ruotsin kasvua – Roger
Wessman