Europe/Middle East

  • The week begins with pressure on the euro and Eurozone bonds.

    A Weak Euro Begins the Week as European Manufacturing Data Disappoints

    The week begins with a narrowly mixed US dollar.  Both Tokyo and London markets are closed today making for somewhat lighter turnover.  The dollar has been trading a quarter of a yen above JPY120.00. 

    The euro stands out.  It has lost almost 0.5%, has dragged the Swiss franc with it.  Recall at the end of last week, the euro was fairly resilient to the US dollar's recovery.  There is a bit of catch-up going on as European dealers returned from their May Day holiday. 

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  • Mixed EU data sends countries' fortunes in different directions.

    The Euro Reaches a Buying Opportunity, European Bonds Continue to Sell Off on Mixed Data

    The euro pullback spurred by the Federal Reserve statement that continued to regard the slowdown as having to been partly caused by transitory factors, was seized upon in Europe as a new buying opportunity.  Support is seen near previous resistance in the $1.1050 area.  The euro extended its recovery, rising to almost $1.1250.  The retracement objective of the slide since mid-December comes in near $1.1265, which is also the boom of the shelf created in February.  Above there, the $1.1515 area is the 50% retracement, while the double bottom projects toward $1.1600-50.

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  • There are advantages to an 'economic-plus-political' EU membership.

    'Economic-Only' vs. 'Economic-Plus-Political' EU Membership

    Norway is often held aloft as an example that the UK could follow in discussions about a potential British exit from the EU (the so-called Brexit). The Norwegian experience with the EU is unique. It shows it is possible for a country to be economically associated to and, at the same time, politically separate from the EU.

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  • The Eurogroup meeting with Greece was particularly acrimonious.

    Greek Negotiating Team Personnel Changes are the Latest Act

    The Eurogroup meeting before the weekend was particularly acrimonious.  Greek Finance Minister Varoufakis was isolated and demonized.  After intensifying their criticism of Varoufakis in the closed meeting, according to reporters, several carried their battle to the media.

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  • European finance ministers say 'No Funds For You' to Greece again.

    Greece's Financial Tragedy Gets More...Tragic?

    They held the umpteenth European meeting to discuss Greece and for the umpteenth time, European finance ministers say no.  No, they will not provide Greece with the funds to service its debt that they hold (the remainder is largely in the IMF and ECB's hands). 

    While there is clearly a greater antagonism between this government and its predecessor,  it did not begin with its election. The official creditors have cut Greece off since the middle of 2014.  Indeed, that act may have led to Syriza's election in the first place six months later. 

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  • Greece likely does not want to be the first to default on debt to the IMF.

    Is There a Better Way to Frame Greece's Rescue?

    With another impending international debt deadline, Greece runs the risk of becoming the first OECD country to default on its obligations to the IMF. The country owes €448m – and many are once again raising the “spectre of Grexit” idea, accompanied by damning commentary on Greece’s failure to get successfully through the crisis.

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