Exasperated eurozone finance ministers are expected to fall in behind Brussels in the row over Italy's budget on Monday, setting the stage for an unprecedented clash. Italy's growth is down, its unemployment up and its debt colossal. This would already be more than enough to cause deep concern as eurozone finance ministers meet for the first time since Brussels rejected Rome's 2019 budget. But perhaps the most striking threat is not the grim economic data itself, but Rome's defiant attitude; Italy's populist government doesn't seem to want to play by the rules. "Everyone is worried," a senior European Union official said, as several sources told AFP most of the 19 ministers would back the European Commission's tough stance. Members of the single currency bloc have flouted collective budget guidelines before, but none so "openly and consciously" as the unrepentant populist coalition south of the Alps. And this unprecedented provocation may draw an unprecedented response. If Prime … [Read more...] about Eurozone ministers prepare for clash on Italian budget
German 10 year bond yield historical data
The closely-watched yield spread narrowed to its tightest in over a week, though moves in the eurozone bond market were small relative to the volatile trade of recent days, ahead of this week's key central bank meetings. US President Donald Trump and North Korean leader Kim Jong Un signed a "comprehensive" document on Tuesday following a historic summit in Singapore, promising to work toward complete denuclearisation of the Korean peninsula. This added to Monday's relief rally in Italian assets after Economy Minister Giovanni Tria told the 'Corriere della Sera' newspaper on Sunday the coalition was committed to remaining in the eurozone. "There is some positive sentiment from the North Korea news, even though a lot of the progress has been priced in already," said ING strategist Benjamin Schroeder. "Also I think the move today is a continued reaction to the headlines from... Italy." The Italian/German 10-year bond yield gap briefly narrowed to 225 basis points (bps), its lowest in … [Read more...] about Italian debt in demand as political storms abate
US & Canada 17 January 2018 Share this with Facebook Share this with Twitter Share this with Messenger Share this with Messenger Share this with Email Share Share this with These are external links and will open in a new window Email Share this with Email Facebook Share this with Facebook Messenger Share this with Messenger Messenger Share this with Messenger Twitter Share this with Twitter Pinterest Share this with Pinterest WhatsApp Share this with WhatsApp LinkedIn Share this with LinkedIn Copy this link https://www.bbc.com/news/world-us-canada-39732845 Read more about sharing. These are external links and will open in a new window Close share panel One year ago, the US elected a man who prefers plain speaking to the language of diplomacy. Find out what President Donald Trump has said about your country, which foreign leaders he has met or called since taking … [Read more...] about What has Trump said about your country?
Programming note: Money Stuff will be off tomorrow, back on Monday.Volcker 1.1.Yesterday the Federal Reserve issued some fairly small proposed revisions to the Volcker Rule, which I guess we have to talk about. Here’s the Fed’s memo explaining the changes, and here is the much more detailed official notice. Here is an overview from Bloomberg’s Yalman Onaran, with the title “Why Wall Street Traders Aren’t Rejoicing (Yet) Over Volcker Rule.” The revisions tinker with the Volcker Rule’s requirements—removing a presumption that securities held for less than 60 days are held for “proprietary trading,” making it easier for banks to demonstrate that their market-making desks hold only enough inventory to meet “reasonaby expected near-term demand” from customers, etc.—to make compliance simpler, but don’t really change the basic structure of its prohibition on proprietary trading at banks.The standard criticism … [Read more...] about The Volcker Rule Gets a Little Easier
Remember how last year was all about the global synchronized economic recovery? This year may be all about the global synchronized bond slump.From Japan to Frankfurt, London and New York, the market for government debt securities was a sea of red Monday as European and U.S. central bankers up their plans to "normalize" monetary policy, which is code for raising interest rates and cutting back on their debt purchases.Although the U.S. Federal Reserve has been doing just that since late 2016, the bond market has largely been able to get by because the European Central Bank and Bank of Japan pressed on with their extraordinary easy money policies. But Monday's action shows what may be in store for bond traders after ECB policy maker Francois Villeroy de Galhau told Bloomberg News that he expects bond purchases to end this year and an interest-rate increase could follow in a matter of “some quarters, but not years.”“We will probably give additional guidance for … [Read more...] about Bond Traders Get a Glimpse of the Apocalypse