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EUROPE
Where on earth is growth
in Greece going to come from? – Frances
Coppola
Financial Stability
Review – ECB
Systemic stress
contained despite bouts of global turbulence – ECB
UNITED STATES
USD boosted by Fed
policymakers' message that summer hike distinctly possible * Blast of Fed
rhetoric last week appeared to be coordinated message * Recent scepticism about
further Fed hikes stemmed from dovish March FOMC * Next hike looks like a done
deal in June or July if the US data permit * Fed now must decide if US economy
sufficiently robust for another couple of hikes * That decision comes against
backdrop of big uncertainty in bizarre US election * Fed is in tricky spot also
as to effects of its actions on global economy * For now Fed is putting on
blinders and declaring total dependency on US data
Signals from the U.S.
Yield Curve: World Can’t Handle Fed Rate Hikes – WSJ
Is the Fed Stuck in a
‘Not So Merry-Go-Round?’ – BB
A lack of policy-driven
stock moves.
OTHER
Fiscal Buffers, Private
Debt, and Stagnation: The Good, the Bad and the Ugly – IMF
Negative interest rates
are the latest in a series of fruitless efforts to revive post-crash economies
using monetary policy. Such efforts amount to a distraction from a fundamental
truth: The only way to ensure that “new money” is put into circulation is to
have the government spend it.
Realising the benefits
that its proponents claim exist would require giving up on interest rate policy
forever.
The first quarter
results season is almost over, and has been marked by positive surprises from
Europe and, less so, the US, while Japanese earnings appear to have suffered
from the strength of the yen.
57% of China AAA Bond
Issuers Have Junk-Like Risks – BB
‘Massive Bailout’ Needed
in China, Banking Analyst Chu Says – BB
Martin Wolf: Here is how
populism can be defeated – FT
There is a widespread
belief that the system is being exploited by disreputable insiders
Fixed Income Markets
Outlook (Q2 2016)
– Daiwa
Jan von Gerich: Bonds:
Repricing of the Fed outlook not complete – Nordea
Recent hawkish comments
from several Fed members have caused financial markets to re-estimate the
pricing of rate hikes. If the Fed really wants to keep June a real possibility,
market pricing needs to shift further. The Fed outlook leaves bonds vulnerable
to short-term selling pressure.
REGULARS
Euro rates update – Nordea
Eye-Opener – Nordea
Caution prevails, USD and JPY
gainers, German numbers in focus * Today German GDP and Swedish labour market
data * German GDP numbers will drive yields * JPY strengthened by trade surplus
Gloom prevailed across much of Asia
today and Europe looks set to follow through in similar vein. In Japan the yen
resumed its rise against the US dollar fuelling negative sentiment and driving
the Nikkei 225 into the red while commodities turned tail on recent gains.
Euro wrap-up – Daiwa
Dollar Regains Momentum, Sterling
Resists
Daily Shot – TF
Emerging markets
globally are feeling increasingly under pressure. Besides the strong US dollar
some are afflicted by political worries others by retreating investor
confidence and others by materials shortages. But one thing they all share is
worringly high debt-to-GDP ratios.
Daily Press Summary – Open
Europe
Boris Johnson dismisses
Treasury report warning of short-term economic shock from Brexit as “a hoax” as
new poll suggests growing support for Remain * Visa-free travel for Turks
likely off the table this summer, Merkel warns * Far right narrowly defeated in
Austria’s presidential election * Eurogroup set to unblock more aid for Greece,
but agreement on debt relief unlikely * European Commission softens tone in
rule of law dispute with Poland * Investors becoming wary of UK and Europe * New
poll: Merkel’s CDU/CSU down almost nine points since 2013 federal election
victory * ‘Missing’ EU graduates leave £89m in unpaid fees
Brussels Playbook – Politico
Austrian takeaways — The
Angie and Erdoğan show
Stronger Dollar Sends Futures
Higher, Oil Lower, Asian Stocks To Two Month Lows
Frontrunning – ZH
USD continues its march
higher particularly against the riskier currencies as the Fed continues to
deliver hawkish comments. EURUSD focus shifts down to 1.1100 and even 1.1000
though US data catalysts are soon needed to boost the greenback further from
here.
Japan has laid down its
marker for yen intervention European banks continue to feel the heat and
there's a nasty Brent long position building that could spell trouble.0
FINNISH
Päätös Kreikan velkahelpotuksesta voi venyä vuoteen 2022
* Fedin Bullard puolsi puheessaan koronnostoa * Jeni oli myötätuulessa *
Ruotsista saadaan tänään myönteisiä työllisyyslukuja