Today, the Bank of England left rates and QE on hold as Governor King decides to wait before more additional easing measures are taken and says that the events in Europe are beyond his control. In October, the BOE surprised the markets with an aggressive increase in QE by 75bln GBP to 275bln GBP. These purchases will be completed in February and the current market expectations are for more QE then. This is despite the downgrade to the 2012 GDP forecasts by not only the central bank, but also by the OBR (Office of Budget Responsibility). While King is correct … …READ MORE
Tag Archives: European Union
The illusion of an impervious Euro
Let’s take a quick spin around the global currency markets to see what the major topics.
First, the price of oil continues to soar as the events in Libya have taken 1 million barrels per day out of the global supply. Brent crude is trading above $188 and Europe is feeling the pain as petrol prices go up. Libyan produced oil went to Italy and now Italy is getting refugees instead from MENA (Middle East North Africa) countries.
Next, the European Union members have been meeting to decide the future of the EFSF (bailout fund) and the future of the … …READ MORE
5 Things U Need 2 Know 2Day
With the holidays fast approaching, here are the top 5 for the week.
1. China’s inflation is soaring, but China didn’t raise interest rates. As rumored, China’s CPI came in smokin’ hot at 5.1% and was a 28 month high for the nation. (PPI was up 6.1%.) Food was the big driver of higher costs and was up 11.7% in the month. History buffs know that the last political change in China occurred due to runaway inflation and a rising up of the population against the incumbent politicos. The good news is that the PBOC (People’s Bank of China) did … …READ MORE
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Getting the Greek to the Market
Tomorrow, Greece will attempt to return to the markets to raise capital for a refunding. It’s a safe bet it’ll go well, but we won’t get a true picture until Greece has to borrow money it doesn’t already have from the European Union.
In an effort to keep contact with the international capital markets, Greece is auctioning off E1.25 billion of 26 week bills on Tuesday. According to Bloomberg, Greece has E4.5 billion of short term securities to coming due between July 10 and July 23rd. According to the IMF, this roll-over isn’t fully funded by the E110 billion loan … …READ MORE
Finally: the European Bazooka!
27 European nations and the IMF agreed to a mammoth E750 billion plan to stabilize the financial markets. 16 Euro area governments were joined by 11 European Union governments in meetings over the weekend to create the plan and commit to E440 billion. The European Union budget is going to contribute E60 billion. The IMF is going to contribute E250 billion. The UK abstained from contributing to the plan.
The European Central Bank is participating by agreeing to provide Euro liquidity and US dollar liquidity. Here are the four measures they’ve agreed to do to address the tensions in the … …READ MORE
We Want It, We Want It, We Want It…….It Costs How Much?
Today, the Euro came under pressure with after a series of stories have emerged over the last 24 hours on the details for a Greek bailout. Denial, delusion, and unstable come to mind for the situation as the markets have already voted with their feet by sending the Euro down 150 pts and sending Greek bonds yield up 27 basis points to 6.83%.
Pointing fingers elsewhere, Greece’s Deputy Prime Minister Theodoros Pangalos stated that their type of debt problems are likely to spread further in the Euro Zone and that Portugal could be next in line for attack. Remember, this … …READ MORE
EU Vested Interest in Greece
The on-going saga for Greece and the European Union continues and the latest headlines are these:
RTRS-PURCHASES OF GREEK BONDS BY EURO ZONE STATE-OWNED BANKS IS ONE OF OPTIONS CONSIDERED IN EU PLAN TO SUPPORT GREECE-EU SOURCE
RTRS-EUROGROUP ON MONDAY TO DISCUSS DIFFERENT OPTIONS OF SUPPORT FOR GREECE -EU SOURCE
RTRS-SUPPORT OPTIONS FOR GREECE COULD VARY FROM COUNTRY TO COUNTRY -EU SOURCE
RTRS-GREEK SUPPORT MECHANISM COULD BE STRUCTURED IN STAGES DEPENDING ON LEVEL OF NEED -EU SOURCE
RTRS-OBSTACLE TO MORE DETAILED AGREEMENT ON GREECE SUPPORT NOW IS LACK OF GERMAN JUNIOR COALITION PARTNER CONSENT-EU SOURCE
RTRS-COUNTRIES COULD PARTICIPATE IN SUPPORT … …READ MORE
Greece Fire Or Can PIIGS Fly?
Today at 11:00 AM ET, I’ll be appearing on CNBC’s the Call discussing the potential bailout of Greece by the European Union.
Before anyone can savor the possible bailout/backing of Greece debt by Germany, we get these series of comments:
GERMAN GOVT OFFICIAL SAYS GREECE MUST PURSUE SUSTAINED PATH TO CONSOLIDATION
GERMAN GOVT OFFICIAL SAYS THERE IS NO DECISION ON AID FOR GREECE, AND IT’S NOT PENDING EITHER
GERMAN GOVT OFFICIAL SAYS IT’S NOT GERMANY’S JOB TO TELL GREECE WHAT IT NEEDS TO DO
GERMAN GOVT OFFICIAL SAYS NO DECISION PENDING ON AID FOR GREECE
GERMAN GOVT OFFICIAL SAYS THE … …READ MORE
