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Monday, May 18

18th May - Greece again at deadline



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EUROPE
Wolfgang Münchau: The simple core of the Grexit and Brexit conundrumsFT
The European problems of Greece and Britain involve no innate difficulty

EURUSD & Peripheral Bonds Tumble As Greek Fears Re-EmergeZH

ITALY: Concluding Statement of the 2015 Article IV MissionIMF

  UNITED KINGDOM
Cutting red tape must be at the heart of any EU reform agendaOpen Europe
Since David Cameron's re-election, the first senior business figure has come out providing qualified support for Brexit absent a significant cut-back on EU regulation. According to our policy analyst Vincenzo Scarpetta, this highlights how vital it is to put cutting red tape at the heart of any EU reform agenda.

Daniel Hannan: Nine ways for Eurosceptics to win the referendumCapx

  GREECE
Would leaving euro be more of a catastrophe for Greece than staying?The Guardian
Leaving the single currency will have all sorts of economic and political costs for Athens, but Iceland’s experience after the banking crisis could prove illuminating

Tsipras letter reveals precariousness of Greece’s financesFT
Greece came so close to defaulting on last week’s €750m IMF repayment that the prime minister warned IMF chief Christine Lagarde he could not pay it without EU aid.

Shape Of Greek Endgame EmergesZH
IMF Discussed "Cyprus-Like" Plan After Tsipras Warned Of Looming Default

Stephen Pope: Will Greece embroider an end to its euro encumbrance?TF
The Greek Prime Minister is standing firm by his election red lines * But this is not in line with creditor expectations * If Greece does not wish to adhere to the program then it should be ejected

Greece Will Default On June 5 Without Deal, IMF LeaksZH
Greece Remains Defiant as It Seeks Creditor Deal This Week – BB
Greek Endgame Nears for Tsipras as Collateral Evaporates – BB

  EUROPEAN CENTRAL BANK
The ECB’s bond purchase programmes and the limits of national risk-sharingvox
QE in the Eurozone is unusual in that the risks of sovereign debt defaults are shared between the ECB and the national central banks. If such risk sharing were applied to the OMT programme, it could potentially create insolvency problems for countries with large public debts, especially in a low-growth scenario.

Now Is The Time For The ECB To Stress Its Commitment To QEAlpha Now
For the first time since 2011 Q1, the euro area economy has expanded by more than that of both the US and the UK. Since the start of 2011 the euro area has underperformed the US and UK by some margin.

Raising Definition of Price Stability ‘Misguided’, Says ECB’s MerschWSJ


ASIA
Does China already have the highest level of margins vs free float in market history?FT

What multiple should we give China’s GDP growth? Michael Pettis

Macro Digest: Why China is more important than the Fed TF
As the US economy stutters towards reversal many minds are focused on the implications for the rest of us. But consider this: more often than not major economic shifts originate in Asia and that's why we should should be taking more notice of what's going on in China right now.

Interest Rate Liberalization — With Chinese CharacteristicsWSJ

Asia monthly update - a temporary reliefNordea
We are generally cautious on EM FX for at least the coming six months. EM FX faces downside risks until the first rate hike has occurred in the US, which we expect to take place in September 2015 (market consensus December). We expect the risk on the EM currencies to tilt on the downside when we move towards year-end. The accommodative monetary policy by the ECB and the BoJ will have some positive but are not enough to counteract the negative effect from the Fed and the strong USD.


REGULARS
Daily Central BanksWSJ
Hilsenrath’s Take: Don’t Put Too Much Weight on Atlanta Fed Growth Estimate Yet * Growth Hiccups Vex Fed Yet Again * Fed’s Evans: Overshooting Fed’s 2% Price Target May Be A Good Idea * Bank of Japan Relaxing All-Out Approach to Hitting Inflation Target * China Reverses Course on Local Debt

Daily MacroWSJ
U.S. economic second-quarter data have disappointed somewhat and the numbers out of China are starting to look worrisome; modestly better results in Europe aren’t enough to offset those. The eurozone, Japan and China’s central banks are all doing as much as they can to boost market liquidity, which means much now hinges on whether the Federal Reserve is sufficiently concerned about a lackluster economic rebound.

Danske DailyDanske Bank

Euro rates updateNordea

Eye-OpenerNordea
FOMC minutes and Euro-area PMIs in focus later in the week * Bond market finally ripe for a rebound? * EUR/SEK with a break higher

Morning MarketsTF
With little on the economic indicator calendar in the early part of the European session, markets will look to this afternoon's US Housing Market Index which is expected to show a slight uptick in consumer sentiment. Elsewhere, Treasuries are back in vogue while the euro may fall out of fashion.

Daily FX CommentMarc Chandler
Dollar Firmer, but Vulnerable

Daily ShotTF
The Chinese housing market remains soft but may be firming as a 6% year-over-year drop in prices has seen buyers begin to return. In Europe, meanwhile, Greece is running out of time as various payment deadlines draw near.

Daily Press SummaryOpen Europe
JCB boss says Brexit would not make much difference * Burnham calls for EU referendum to be brought forward and for Cameron to secure “tough but fair” deal on EU migrants’ access to benefits * Farage: I have an important role to play in the pro-Brexit campaign * Tsipras sent a letter to the IMF warning Greece may not be able to make its payments * French PM rejects idea of binding EU migrant quotas * Protests rock Macedonia’s capital

Brussels PlaybookPolitico

US OpenZH
Gold Jumps Despite Stronger Dollar As Grexit Gets Ever Nearer, Futures Flat

FX UpdateTF
We do have a sprinkling of interesting US data points this week, and a set of FOMC minutes up on Wednesday, but the key focus for the USD and EUR this week may be on whether the recent case of bad nerves in European bond and equity markets is easing.

From the FloorTF
If this EURUSD rally gets any stronger, European Central Bank president Mario Draghi might just start "losing his mind" as the best laid plans of mice and men unravel.

Martin Sandbu’s Free LunchFT
Ukraine's weaponised debt: Advocates of debt reduction for Ukraine are right


FINNISH
AamukatsausNordea
Fed odottaa jäiden sulamista – Kiina pyristelee kohmettumista vastaan | Dollari vahvistunut heikon USA:n talouskehityksen myötä | Euroalueen ostopäällikköindeksit luvassa torstaina

Aki Kangasharju: Yrittäjyys ei saa jäädä sosiaalipolitiikan jatkeeksiNordea
Hallitus haikailee satojentuhansien uusien työpaikkojen perään. Keskeisin keino on yrittäjyyden ja yksityisten yritysten kasvuedellytysten parantaminen, koska julkinen sektori on jo ylittänyt talouden kantokyvyn. Ilman uusia panostuksia kansainvälistymiseen uusille tuotteille ei kuitenkaan löydy kysyntää ja yrittäjyyden edistämisestä tulee vain uusi sosiaalipolitiikan muoto.

Ekonomistit: Vientimarkkinan elpyminen ei vedä Suomea mukanaanYLE
Rupla ja kruunu tekevät hallaa - tavanomaisesta poiketen Suomi ei ole päässyt kunnolla hyötymään kauppakumppaneiden kasvusta. Tämä kasaa paineita tulevan hallituksen kilpailukykypolitiikkaa kohtaan.

Olli Herrala: Sipilän hallituksen älykkäimpiä vetojaKL
Sipilän nupullaan oleva hallitus päätti ensi töikseen rakentaa EU- ja ETA-alueen ulkopuolelta tuleville opiskelijoille lukukausimaksut. Linjaus on hyvä.

Tiivistä tietoa kannustinloukuistaOlli Kärkkäinen

Henri Myllyniemi: Yrittäjyys luo kilpailua, herrajestaUS