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Wednesday, November 2

2nd Nov - Fed signals Dec hike probable





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EUROPE
German Economists Urge EU to Shun Brexit Taboos to Keep U.K. InBB
EU balance shifting against market economies, advisers say * Government advisory panel still sees chance to avoid Brexit

  EUROPEAN CENTRAL BANK
Otmar Issing: Central Banks and the Revenge of PoliticsProject Syndicate
The ECB, especially, is set to face growing pushback against its independent status, regardless of whether it manages to “save” the EMU. After all, it would have to be quite powerful to succeed – too powerful for any democracy to abide.

The dark sides of QEDeutsche Bank
Backdoor socialisation, expropriated savers and asset bubbles

Deutsche Bank Thinks Draghi’s Gone Over to the ‘Dark Side’ BB
Chief economist David Folkerts-Landau says ECB has entered new dimension of moral hazard

Exchange rate pass-through into euro area inflation – ECB
ECB Study Finds Impact of Weak Euro on Prices Recedes With Time – BB
TARGET balances and the asset purchase programme – ECB

  UNITED KINGDOM
Is austerity to blame for Brexit? – Simon Wren-Lewis
WTO rules mean Brexit and new trade arrangement not fully separable – Open Europe
London Judges Said to Rule on Brexit Challenge Thursday Morning – BB
Brexit Bulletin: The View From Berlin – BB


UNITED STATES
Martin Enlund’s Global FX Strategy: USD - Wu & Xia vs TrumpNordea
Renewed risks of a Trumpening have temporarily dented the USD’s upward trajectory. This is a temporary setback as focus will soon return to European politics, the Fed’s rate hike as well as to ECB’s QE extension.

  OCTOBER JOBS
ADP October +147,000 jobs, fewest workers in five months –
BB
ADP Employment Report Sinks To Weakest Since April 2013 –
ZH
ADP: Private Employment increased 147,000 in October –
Bill McBride
U.S. private sector adds 147,000 jobs in October: ADP – Reuters

  PRESIDENTIAL ELECTIONS
The race is tightening – Nordea
Clinton or Trump - free trade is under pressure – Nordea
Election Guide to Markets: What to Watch With 7 Days to Go – BB
Citi Explains What Time Traders Can Go Home On Election Night – ZH
  
  FEDERAL RESERVE
The Fed Meets in November to Tee Up a Hike in Dcember – BB
Fed's November meeting IS the December one – TF
Yellen Questions – John Cochrane
Decision-day guide: Fed may nod to December hike in 2015 rerun – BB
November Policy Statement – FED
Fed holds rates steady, sets stage for December hike – Reuters
Fed Sets Up Possible December Move While Leaving Rates on Hold – BB
A December Interest-Rate Increase? Why Tuesday’s Election Matters – WSJ
It’s going to be one heck of an election year, Fed meeting edition – FT
FOMC Says Little New, December Hike Remains Likely – Marc Chandler
Unchanged, says case for a rate hike ‘has continued to strengthen’ – Danske Bank
Fed Holds, Says Case For December Hike "Strengthens" – ZH
December Rate Hike Odds Spike To 80% - ZH


OTHER
Aurelija Augulyte: JPY - not so fast... – Nordea
The JPY weakened and undershot the market indicators. It is still far from "overvalued". The US election poses near term strengthening risks.

Martin Enlund: USD: - Wu & Xia vs Trump
Nordea
Renewed risks of a Trumpening have temporarily dented the USD’s upward trajectory. This is a temporary setback as focus will soon return to European politics, the Fed’s rate hike as well as to ECB’s QE extension.

China Is Losing Its Emerging Markets Growth Engine
BB
Commodity price rally raises hopes that demand will pick up * Emerging markets now account for a third of China’s exports

Fastest-Growing China Provinces Can’t Quit Investment AddictionBB
Total investment in five fastest-growing provinces exceeds GDP * Top performers depend on property, infrastructure investment

The New View of fiscal policy and its applicationvox
Examples from the US and Europe to highlight the five principles of a ‘New View’ of fiscal policy, which increasingly appreciates that expansionary fiscal policy is effective in a world of persistently low interest rates, low growth, and strong international linkages.

Oil Market Turns Skeptical About OPEC’s Ability to Deliver CutsBB
Prices slide to near levels before Algiers accord on output * OPEC and Russia boost production to record levels despite deal

Editorial: Free Trade’s Bleak OutlookView / BB

Debating Free Trade and the Populist BacklashView / BB

"Trump Hedge" USDMXN volatility spikes to highest in 5 yearsZH


REGULARS
Danske DailyDanske Bank

Eye-OpenerNordea
European currencies outperform on Trump fear, USD rates dip ahead of silent Fed * Fed to hint at December rate hike? * Rates start the month reversing lower * European currencies gain as stocks drop

Morning MarketsTF
The gap between Clinton and Trump has narrowed prompting Japan’s Nikkei to drop over 1% the volatility index to spike and the USD to sell off against its peers. Expect a rocky day.

Euro wrap-upDaiwa

Daily Market CommentMarc Chandler
Standpat FOMC Trumped by US Political Jitters

Daily Market CommentMacro Man
Dodgy credit

Daily Press SummaryOpen Europe
Autumn Statement to ease off fiscal targets to create Brexit contingency “headroom” * City lobby calls for “mutually beneficial” financial services deal with EU as UK surplus hits record £63.4bn in 2015 * German government economic advisors recommend to “prevent Brexit through constructive negotiations” * Former Canadian PM: UK can learn from Canada’s experience of trade integration without surrendering sovereignty

Brussels PlaybookPolitico
Oettinger fallout continues — EU-China tit-for-tat

Five Things You Need to Know to Start Your DayBB
Fed day * Election anxiety * Oil slide continues * Stocks slide * Tech earnings

US OpenZH
Global Stocks, Peso, Oil Drop On Trump Fears; Safe Havens Rise Ahead Of Fed Announcement

FrontrunningZH

FX UpdateTF
USD weaker versus safe haven currencies as markets fret the odds of a Trump victory next Tuesday and the uncertainty this brings to global markets. EURCHF has broken down out of the recent range as risk appetite shaken globally and the JPY has surged as bond yields pulled back lower.


FINNISH
AamukatsausNordea
Ei vielä tänään, mutta joulukuussa * USA:n teollisuuden luottamus (ISM) nousi lokakuussa 51,9 pisteeseen * Britannian ostopäällikköindeksi edelleen vahva * USA:n vaalitilanteen tiukkeneminen vähensi markkinoiden riskinottohalukuutta