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BREXIT
How the ‘Brexit’ Summit
Will Unfold and Why You Should Care: Q&A – BB
Leaked Brexit summit
text: Full annotated document – FT
What European capitals
think of David Cameron’s EU reforms – Politico
Editorial: Europe's Last
Chance to Keep the U.K. – View / BB
Stephen Pope: Brexit’s
costs and benefits – TF
To BRexit, or To
BRemain? – euinside
UNITED STATES
The Fed is on hold,
stuck in risk management mode until the skies clear. If you are in the
"recession" camp, the path forward is obvious. The Fed cuts back to
zero, drags its heals on more QE, and fumbles around as they try to figure out
if negative rates are a good or bad thing. Not pretty. But if you are in the
"no recession" camp, it's worth thinking about the implications of a
Fed pause now on the pace of hikes later. Being on hold now raises the risk
that by the time the Fed moves again, they will be behind the cycle.
OTHER
EUR gains, European bank
worries and the oil price plunge are all indicative of an übersoft ECB, which
should help keep the single currency on the back foot unless overwhelmed by
repatriation of capital due to bank deleveraging.
US policy-makers such as
NY Fed's Dudley have argued the Fed can tolerate low market-based inflation
expectations. However, things would change materially if surveys start to show
signs of becoming too low (so-called de-anchoring of expectations). In this brief
piece we take a look at various measures of inflation expectations and find
that evidence of de-anchoring remains inconclusive, although some developments
could be seen as a bit worrisome by Fed doves.
Brazil, Germany, Canada,
U.S. forecasts cut most severely * G-20 ministers urged to tackle lack of
demand in Shanghai
REGULARS
FOMC minutes depresses yields and
lifts equites * Finally some inflation in Sweden? * Majors lose to USD on
better US inflation data
The bears are in retreat over crude
optimism evident in equities forex and commodity prices. Hopes that top oil
producers are making progress in tackling the supply glut is behind the upbeat
mood with Iran apparently backing the Saudi and Russian output freeze proposal.
China and Japan are
sending negative signals to the world while Ithe oil price is up again and
investors are willing to take more risk again.
Merkel: UK renegotiation
demands are “justified”, keeping Britain in EU “is in our national interest” * Latest
draft deal shows UK is facing resistance on safeguards for non-Eurozone
countries * Boris Johnson still on fence over EU ahead of publication of new
parliamentary sovereignty package * EU-Turkey mini-migrant summit cancelled in
wake of Ankara attacks * Renzi: We would veto Eurozone-wide cap on banks’
government bond holdings
Brexit deal day — Turkey
bombing — Migration mini-summit canceled
Biggest Short Squeeze In 7 Years
Continues After Bullard Hints At More QE, OECD Cuts Global Forecasts
The Japanese yen is not
responding to the steep rally in risk sentiment as it normally does as EURJPY
continues to eye the cycle lows ahead of today’s ECB minutes release. Elsewhere
Mexico slammed the peso shorts with a triple whammy of a surprise interest rate
hike new intervention policy and fiscal measures.
Markets are in the green
after a very weak start into the year. Stock picking might allow for high
returns though – even in the energy sector.
FINLAND
& FINNISH
Suomen
inflaatio lävähtää pakkaselta plussalle * EU:n huippukokous alkaa tänään *
USA:n teollisuustuotanto elpyi voimakkaasti tammikuussa * Ei yllätyksiä Fedin
kokouspöytäkirjassa