18th Jun - Political risk from Germany

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EUROPE

European recovery is bad news for the world's bond prices – FT

That sucking sound is the retreat of the ECB, says Oxford Economics.

Italy’s Anti-Migrant League Tops Five Star in Poll for First Time – BB

Salvini’s League leads SWG opinion poll with 29.2 percent as coalition partner Five Star drops 2.4 points since vote

  GERMANY
Germany: Cruising along, but vulnerable – Danske Bank

The current boom phase still has ‘air to run’ with growth to remain above potential at 2.1% in 2018E and 1.9% in 2019E, before moderating to 1.6% in 2020E.

Merkel Fate Hangs in Balance as CSU Sets Deadline – BB

CSU leader reportedly says he can’t work with Merkel any more * CDU seeking compromise via EU partners, says key Merkel ally

Angela Merkel’s Political Future Is At Risk – BB

Chancellor has until June 28-29 EU summit to get European fix * Migration has surged to top of political agenda across Europe

Merkel Accepts Deadline in Coalition Fight Over Refugees – BB

Migration will now top agenda at EU summit on June 28-29 * Merkel adamant in face of Bavarian sister party’s defiance

Migrant crisis sets Merkel a Herculean diplomatic task – Handelsblatt

With the migrant crisis stoking tensions in the EU and within her government, Angela Merkel has two weeks to broker complicated compromises. Without a deal, her days as chancellor could be numbered.

Merkel seeks EU crisis talks as migration rocks Berlin coalition – FT

Chancellor seeks to head off split threatening German government

German crisis eases as Merkel strikes deal with CSU – FT

Chancellor buys time to seek pan-European solution to refugee crisis at EU summit

Crisis averted? Minister says migrant row with Merkel can be overcome – Reuters

Trump Derides German ‘Leadership’ in Slap at EU Migration Crisis – BB

Migration will now top agenda at EU summit on June 28-29 * Merkel adamant in face of Bavarian sister party’s defiance

UNITED STATES

The "Worst Case Scenario": A 10% Tariff On All US Imports & Exports Would Slash S&P EPS By 11% - ZH

  FEDERAL RESERVE

What could trigger a Fed pause? – ABN AMRO

The most likely driver of a pause would be a decline in business confidence on the back of trade tensions. There is scant evidence of this as yet. Other potential triggers include renewed and successive undershoots of inflation (à la 2017), an accelerated flattening in the yield curve, or an escalation of EM stress to a broader crisis

The Fed steams ahead, regardless – Pictet

A Fed that has been raising rates because of solid domestic data lies behind the dollar’s strength—but for how long can the Fed stay oblivious to an increasingly fragile global picture?

OTHER

JPM: "The Global Bond Curve Just Inverted" – ZH

Goldman Co-Head Of Trading  Worried The Market May Break And Not Snap Back – ZH

Editorial: Maybe the Big Four Auditing Firms Do Need to Be Broken Up – BB

But first let's see if the current rules can be made to work.

  TRADE WAR
Next Move Is Trump's After China Hits Back in Trade-War Opener – BB

China turns tables on import pledges, hitting U.S. commodities * Analysts say Trump’s strategy on China tech rise won’t work

Pressure is rising in US-China trade – Pictet

The US will hit USD34 billion (out of a total of USD500 billion) of imports from China with a 25% trade tariff, effective 6 July.

REGULARS

EU Open Rundown – RANsquawk

Market Briefing: Daily Markets Overview – Yardeni Research

FirstFT Daily Briefing – FT

Banks’ record payouts, Colombia election, visualising blockchain

WSJ City – WSJ

Slower Earnings Threaten Bull Market, Steep Oil and Strong Dollar Spell Pain

Danske Daily – Danske Bank

Daily Market Comment – Marc Chandler

Politics and Economics Weigh on European Currencies

Brussels Playbook – Politico

Merkel’s crunch time — Commission gives the finger on Selmayrgate — What’s next for Poland

Five Things You Need to Know to Start Your Day – BB

US Open – ZH

Global Stocks, Futures Tumble On Trade War, Merkel Shock; Oil Volatile Ahead Of Meeting

FINNISH

Aamukatsaus – Nordea

Trumpin tullipäätökset ylläpitävät kauppasodan uhkaa, EU ja Kiina vastaamassa tulleihin? | Loppuviikko sisältää useita keskuspankkikokouksia | Tuottavatko euroalueen ostopäällikköluvut jälleen pettymyksen perjantaina?