News and Reviews European Economic Zone

[mynameisandhy]

News and Review of European Economic Zone

 

Draghi: ECB Will not Notwithstanding Mandate

Wednesday, August 29, 2012

 

Mario Draghi was determined to keep the mandate constitutional, but considered euro-zone needs a breakthrough.

 

President of the European Central Bank (ECB) insists the side will always 'acted as mandated' legislation. In an article interview released by the German media, Die Zeit, Mario Draghi also claimed to stabilize prices sometimes have to be more aggressive. As a standard policy instruments do not work, then the ECB could take a further blow. "When the market is affected by anxiety that is not rational, policy signals we have touched people across the euro-zone," he said. Therefore, he wants the ECB to penetrate any obstacles that were under the eurozone monetary policy and have price stability.

 

Draghi's attitude could be interpreted as the firmness of a leader's central bank to carry out its mandate. As is known, the Germans repeatedly opposed the economic recovery plan designed by the ECB, including the purchase of government bonds problematic discourse. But the meaning behind comments Super Mario still can. Does that mean it will move against the direction of German policy? Or it is trying to explain the reasons behind the plan to the Bundesbank. But one thing is for sure, he has not seen the importance of forming a monetary zone 'United States of Europe' as it had sounded many observers.

[mynameisandhy]

News and Review of European Economic Zone (Italy)

 

Italian Bond Auction Success Enough

Thursday, August 30, 2012

 

Rampant reactivation hopes of ECB bond-buying program helped to sell the debt in Italy this afternoon. Borrowing costs on 10-year bonds fell to 5.82% lower than the 5.96% the previous auction. Investor demand also quite good views of the increase in the ratio of the bid-to-cover to reach 1.4; higher than the previous auction 1.3. The euro maintained gains after the news was released. EUR / USD is now trading 1.2554, close to the level of 1.2563 daily high

[mynameisandhy]

News and Review of European Economic Zone (Germany)

 

German Unemployment Claims Increase

Thursday, August 30, 2012

 

Protracted euro zone debt crisis seems to successfully undermined the ability of the German economy in creating jobs. Jobless claims increased for five consecutive months in August, although the unemployment rate was steady at 6.8%. Jobless claims increased by 9000 is worse than 7000 prediction; publication July was also revised higher from 7000 to 9000.

 

"The momentum for the labor sector began to decrease.'s Quite reasonable with slowing economic conditions especially with the protracted euro zone debt crisis," said Commerzbank economist, Eckart Tuchfeld. The German economy only please register growth of 0.3% in the second quarter and many economists who predicted the performance of Germany will continue to weaken amid protracted debt crisis.

[mynameisandhy]

News and Review of European Economic Zone (Switzerland)

 

Swiss Dollar Weakens in Early European Session

Thursday, August 30, 2012

 

Dollar Swiss eased back to 0.9561 (current low) after holding above 0.9580 since the New York session on Wednesday, the beginning of the opening of the European session, the currency is moving a little correction to the 0.9570 area.

 

The market interpreted the Fed's Beige Book Data are less dovish than the FOMC minutes last result and position itself as ahead of Bernanke's speech at Jackson Hole on Friday. During the European session, investors will watch German unemployment rate data, HICP at Spanish, Italian 10-year bond auction, the amount of money circulating in the UK.

 

"Psychological resistance levels are 0.9699, short-term trend is still bearish" writes Commerzbank analyst Karen Jones, contrary to decline going through 0.9538 and possibly towards the 0.9500.

[mynameisandhy]

News and Review of European Economic Zone

 

Ask Merkel Spanish-Italian Delay Bailout Requests

Friday, August 31, 2012

 

The battle between the German central bank (Bundesbank) and the European Central Bank (ECB) related crisis recovery program more pointed.

 

Chancellor Angela Merkel is convinced that Mario Draghi intention to buy up troubled government bonds could be delayed. One way is by asking prisoners to countries that do not ask for a bailout for the moment. Media reported Friday edition of El Mundo.

 

Merkel has persuaded the Prime Minister of Italy, Mario Monti to delay request for help while. German Chancellor will also submit similar requests to Mariano Rajoy, Prime Minister of Spain at a meeting in Madrid next Thursday. As is known, the ECB states could only intervene if the crisis countries are problematic already formally applied for assistance to the European authorities. Without that mechanism, the central bank is not willing to do the action in a constitutional manner.

 

Angela Merkel wanted to reduce high tension between Bundesbank chief Jens Weidmann and Mario Draghi. Weidmann is the figure most opposed ECB bond-purchase plan by arguing that it violated the mandate of the central bank. Weidmann tough stance makes it so the most hated figure in Germany and Europe. Media even predicted he would resign if his judgment is not taken by the ECB.

Separately, Bloomberg reported that the Spanish government to finance the recapitalization Bankia considered independently. Parties Madrid likely to choose that option instead of asking for funds from the European Union worth 30 billion euros. Another option is to ask for loans from the ECB and wait for payments in November.

[mynameisandhy]

News and Review of European Economic Zone

 

Must Involve IMF ECB Intervention

Friday, August 31, 2012

 

ECB bond buying program only if the IMF to participate in determining the reform program of the euro-zone members who want the central bank to intervene, according to the ECB board member Joerg Asmussen. "Euro-zone bailout fund must first intervene in the primary market before the central bank to act. Broad economic reforms will be one of the prerequisites for ECB support," said Asmussen. "The IMF should be involved in determining the reform program because the agency has a special ability in that area."

 

The ECB seems to have no choice but to take a greater role in fighting the euro zone debt crisis at a time when European politicians will still negotiate the best way to solve debt problems. However, the European Central Bank also stressed that the government should not over-rely on the institution. "No one deserves to ask the central bank to do something if it does not do what it should be implemented. Central bank policy is not a substitute for government policy," said Asmussen. "The actions of the central bank alone can not resolve the fiscal problems. Government must play a role."

 

Meanwhile, the euro rose on the London session. EUR / USD is now trading 1.2586, close to the level of 1.2594 daily high

[mynameisandhy]

News and Review of European Economic Zone

 

Euro-Zone Unemployment Rate Reaches 11.3%

Friday, August 31, 2012

 

Economic contraction and widespread implementation of austerity policies make the euro-zone unemployment remained at a high level. The unemployment rate reached 11.3% for the month of July according to predictions. However, the unemployment rate in June was revised up from 11.2% to 11.3%.

 

The high unemployment rate will certainly provide additional evidence of the magnitude of the negative impact of protracted euro zone debt problems. It certainly could encourage the ECB to reactivate the bond purchase program at its September meeting. Recent reports indicate the European Central Bank intervention will focus on short-term maturing debt and the majority of the Spanish and Italian government bonds as ECB seeks to prevent further spread of the debt crisis.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

UK Manufacturing Activity Rises

Monday, September 3, 2012

 

Celebration of the Olympic Games in London seems to work to boost manufacturing activity in the UK for the month of August. Manufacturing index rose to 49.5, better than predicted 46.1 and 45.4 July publication. Sterling rose after the news was released. GBP / USD is now trading 1.5892, close to the level of 1.5898 daily high

 

Increased domestic demand despite dominating the improvement of the manufacturing sector remained weak export demand as the slowing world economy. "The contraction of the UK manufacturing sector began to subside. However, a sharp decline in activity in July last to make repairs in August will not be so mean, and it certainly signaled a still fragile UK manufacturing sector," said David Noble, CIPS leaders interviewed Dow Jones.

[mynameisandhy]

News and Review of European Economic Zone

 

Euro-Zone Manufacturing Activity Still Weak

Monday, September 3, 2012

 

Protracted European debt problems and the threat of the spread of the global economic slowdown in the euro-zone manufacturing sector still experienced a contraction in August. Euro-zone manufacturing index reached 45.1, lower than the predicted 45.3 and 45.3 July publication. Still poor performance of manufacturing would make the gloomy economic outlook. The threat of a recession in the euro zone now looks more real, especially after GDP contracted 0.2% in the second quarter of 2012. Euro looks reluctant to continue the recovery after the news was released. EUR / USD is now trading 1.2578, try to avoid high levels of daily 1.2585.

 

Germany and France, the two largest economies in the euro zone, it is also natural weakening manufacturing sector activity. "Despite the fall of the signal may have ended but the outlook is still bleak manufacturing sector," said Rob Dobson, senior economist at Markit. "Weak manufacturing activity would undermine the economic performance of the euro-zone for the third quarter of 2012. Conditions in the euro zone is not likely to naturally repair the euro zone's structural problems can be solved and the global situation improves."

[mynameisandhy]

News and Review of European Economic Zone

 

Germany Wants Restrictions ECB Banking Supervision

Monday, September 3, 2012

 

German finance minister, Wolfgang Schaeuble, European Commission rejected a plan to give the ECB the authority to oversee all euro-zone banks. Germany wants the restriction that the ECB only focus on large banks that impact systematically. Plan authorizing banking supervision to the ECB is the first step to establish a banking union and the European Commission is scheduled to release its proposal on September 12.

 

"The ECB has uttered the inability to control the entire 6000 banks in the European Union," Schäuble said in an interview with German radio. "I'm not sure monitoring plan can be realized immediately. However, if the ECB focus oversee large banks, which have systematic effects, it is possible that the plans can be diwudukan in the near future."

 

In the meantime, please register weakening euro thin in the London session. EUR / USD is now trading 1.2569, moving away from a daily high level 1.2585

[mynameisandhy]

News and Review of European Economic Zone (Switzerland)

 

Swiss Economic Recession Threshold

Tuesday, September 4, 2012

 

Swiss economy has long shown resilience to the economic crisis in Europe, but it seems the current state has changed after the latest statistics recently released show that the Swiss economy slowed in line with the rest of Europe.

 

After a strong first quarter, the Swiss economy contracted in Q2 due to a sharp decline in exports to the euro zone, and it is also the country's largest trading partner Alpine's. Compared with the previous year, the Swiss economy rose only 0.5%, however when compared to the first quarter performance of the economy to contract by -0.1%.

 

Of the European economic crisis has the potential to drag the Swiss economic growth further in the coming months, perhaps even entering a brief technical recession, if reported further contraction in the third quarter. So the speculation might be canceled that the central bank will release the ceiling exchange rate swiss franc against the euro at 1.20.

 

"Three months ago, the Swiss economy looks solid though backed by the eurozone's debt problems, but now just the opposite where the Swiss also towards the brink of recession," said janwillem Acket, chief economist at Julius Bär Zurich.

 

Early indications emerging from the recession that Swiss manufacturing industry reported an order peunrunan months old. Data released Monday by the manufacturer is still indicating a slowdown in production due to orders fell sharply.

 

PMI manufacturing index fell to 46.7 in August from 48.6 in July, the report is a fifth below the threshold of 50 that distinguish between expansion and contraction of the economy.

 

Economic uncertainty in the euro zone is of great concern for the Swiss and the SNB, Mr Jordan said: "In the current situation, further appreciation of the Swiss franc currency will be a huge threat to the Swiss economy, even bringing deflation risks to growth."

[mynameisandhy]

News and Review of European Economic Zone

 

Draghi Stabilize Yield Bonds Europe

Tuesday, September 4, 2012

 

Performance of short-term bonds of Spain and Italy these days are pretty good so it dragged lower yield.

 

Improved bond movement a day after the president of the European Central Bank signaled bond purchase program details. Mario Draghi indicated the new bond purchases could include debt securities with a maturity of up to 3 years without violating the bank's own funding authority.

 

Yields on two-year Spanish tenor turun0.26 percentage points to 3.05%. While the 2-year Italian bonds fell 2.34 percentage points to 00:29% (data: Tradeweb). A story called Mario Draghi has informed discourse and the mechanisms of the program to members of the European parliament on Monday.

 

For longer tenor bonds, yield 10-year Spanish bonds dropped 6.68 percentage points to 00:14%. Meanwhile, Italian 10-year yield fell 5.71 percentage points to 12:06%.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Osborne survives reshuffle the Cabinet of the United Kingdom

Tuesday, September 4, 2012

 

Prime Minister David Cameron's cabinet overhaul in order to restore public confidence in government. Popolaritas coalition government between the Conservatives with the Liberal Democrats getting eroded as the protracted economic recession and drastic austerity policies.

 

However, the majority of positions are not naturally change where Finance Minister George Osborne and Foreign Secretary Willaim Hague still held his position. Osborne very unpopular after raising the costs to retire but lowering taxes for the rich. Osborne even booed when giving medals to race winners in the arena Paralympics. Previous survey showed Osborne must be removed from the cabinet to replace reign but if Cameron can be pointed out as the failure of the government's economic policies.

 

Meanwhile, sterling weakened in the New York session. GBP / USD is now trading 1.5873, moving away from a daily high level 1.5908

[mynameisandhy]

News and Review of European Economic Zone (Spain)

 

Bank of Spain pours Emergency Banking Liquidity

Wednesday, September 5, 2012

 

Spain's central bank on Wednesday took the unusual step to confirm if they have provided extraordinary liquidity rock to local banks through non-traditional means, although they claim the amount of funds provided is still small.

 

A statement from the Bank of Spain was issued in response to the Wall Street Journal reporting that highlights concerns that Spanish banks may not have sufficient collateral to receive loans from the European Central Bank.

 

With the release of the statement means that the Spanish banking authorities have activated the Emergency Liquidity Assistance program (ELA), which allows the lender to borrow directly from the Bank of Spain without having to pass through the relatively stringent collateral requirements of the ECB. In July, Spanish banks seem to have benefited by receiving ELA approximately € 400 million ($ 500 million).

[mynameisandhy]

News and Review of European Economic Zone

 

ECB's Asmussen Want Euro Stability

Wednesday, September 5, 2012

 

Euro can only be stable if there is no doubt on kelanggengannya, according to ECB board member Joerg Asmussen also re-affirmed support for the planned purchase of euro-zone government bonds. "The widening of risk premiums in the bond market reflects not only the liquidity problems of the particular country but also foreign exchange risk is theoretically Eddy was not in the currency union," said the ECB's Asmussen.

 

"The market is now anticipating the demise of the euro-zone scenario. Currency union for such doubts should not exist. A currency can only be stable if there is no doubt going kelanggengannya," said the ECB's Asmussen. "This doubt also helped wounding mechanism of monetary policy by influencing the transmission rembetan effects on households and businesses."

 

Meanwhile, the euro still slumped in the negative zone in the New York session. EUR / USD is now trading 1.2568, not far from the level 1.2558 daily low

[mynameisandhy]

News and Review of European Economic Zone

 

Hollande: Joint EU ECB must intervene Bond Market

Wednesday, September 5, 2012

 

After attending the meeting with Italian Prime Minister Mario Monti on Tuesday, French President Francois Hollande said that the summit agreement last June must be implemented and the summit next October should result in further steps. Hollande see if the austerity policy is not the only way to improve competitiveness.

 

At the same time the French president also expressed when Prime Minister Monti has expressed concern on the growth and stability. Hollande also urged EU leaders to immediately intervene in the bond market with the help of the ECB and the European Stability Mechanism (ESM).

 

Regarding Greece, Hollande insisted that the country "should get more time if Troika austerity plan approved them. Greece also should be allowed to stay in the euro bloc."

[mynameisandhy]

News and Review of European Economic Zone

 

ECB Keep Interest Rate at 0.75%

Thursday, September 6, 2012

 

The ECB kept interest rates again at a low level of 0.75% at its September meeting. This is according to predictions and unchanged from the August publication also remain at 0.75%. The euro rose after data released since there are some small traders who expect the ECB to loosen monetary policy to support the recovery of the euro-zone economy. EUR / USD is now trading 1.2630, try to stay away from the daily low of 1.2592.

 

Investors are now looking forward to the ECB press konverensi at 19.30 pm where markets expect the central bank will reactivate its bond buying program. The market will surely see the details of the policy to see if Spain can accept preconditions that might be posed ECB that can help cut the cost of borrowing the Spanish government bonds.

 

However, Societe Generale warned investors to be wary of potential profit-taking EUR / USD given the general consensus that the ECB would announce bond purchases a policy with a maximum tenor of 3 years and will not be sterilized. "The consensus like this is very unusual," said Societe Generale analyst interviewed Dow Jones.

[mynameisandhy]

News and Review of European Economic Zone (Germany)

 

German Manufacturing Orders Up

Thursday, September 6, 2012

 

German manufacturing activity is still growing in July; cue is certainly the largest economy in the euro zone could still avoid recession despite the threat of a debt crisis still ensnare other euro-zone members. Factory orders rose 0.5% better than the predicted 0.3% and previous publications are down 1.6%. Euro still hold gains after the data was released. EUR / USD is now trading 1.2610, not far from the level 1.2635 daily high

 

Manufacturers increased orders from both domestic and foreign. Domestic and overseas orders each increased by 1% and 0.1%, better than the publication in June were down 1.8% and 1.5%.

[mynameisandhy]

News and Review of European Economic Zone

 

Issues Slowing overload ECB Optimism

Thursday, September 6, 2012

 

Ahead of the meeting of the European Central Bank (ECB) to be in the title of today (Thursday, 06/09) of the world market looks optimistic apparent that some major world currencies and stock markets in Asia recorded positive figures.

 

Investors look back motivated because most of the market optimistic about the plan from the ECB in response to the debt crisis in the Euro area. It's just the issue of the global economic slowdown problem is rampant in the market so it is worrying investors participated and also helped limit the rate of movement of the market rally after a string of economic data in the world came up with disappointing figures.

 

The attention of market players continues to this day focused on the European Central Bank meeting today, then the data is American employment or non-farm payrolls on Friday, tomorrow and the U.S. Federal Reserve meeting next week.

[mynameisandhy]

News and Review of European Economic Zone

 

After the ECB came Investor Optimism

Friday, September 7, 2012

 

At the end of the trading week (Friday, 07/09) of the world market seems optimistic in the positive range after yesterday's European Central Bank (ECB) has finally agreed to launch a new bond-buying program in an amount not limited to stem the euro zone debt crisis. And the meeting was in line with expectations for this market.

 

The ECB also kept interest rates remain at the level of 0.75%. In addition to launching programs aimed at reduce distortions in the secondary bond markets, the ECB also offers easier access to loans to banks from countries with lower gain bailouts assurance standards.

 

However, some analysts argue that the major currencies especially the euro may still be difficult to appreciate even more, given the German Constitutional Court will announce its decision on a permanent European bailout fund facility on September 12.

[mynameisandhy]

News and Review of European Economic Zone

 

Greek Bailout Next Will decided after October 8

Friday, September 7, 2012

 

Troika inspectors consisting of the EU, IMF and ECB plans to submit a comprehensive report on Greece on 8 October, according to a newspaper report on Thursday Germany.

 

On the same date European finance ministers with ECB President Mario Draghi as well as representatives of the IMF and the European Union is scheduled to hold a meeting in Luxembourg to discuss the report, Sueddeutsche Zeitung reported.

 

Through a statement earlier this week, German Finance Minister Wolfgang Schaeuble has confirmed that the first Greek progress report will be available in October, so that the disbursement of further aid for Athens would be determined after the report is available.

[mynameisandhy]

News and Review of European Economic Zone

 

Euro Rebound After U.S. Non Farm Payrolls

Friday, September 7, 2012

 

The appreciation of the Euro against the greenback to continue, even to touch its highest level since mid-June, after the release of U.S. economic data showed job growth is much less than expected in August.

 

The results were a little disappointing was re-ignited speculation that there is further quantitative easing from the U.S. Federal Reserve, the U.S. dollar hitting all over the market.

 

Though at the same rate U.S. unemployment rate fell to 8.1% was released, it did not hinder the EURUSD to print new daily highs at 1.2775. EURUSD is currently trading at around 1.2770 or approximately 1.1% above yesterday's closing price.

 

"If the currency pair managed to close the week's trading at 1.2745, further appreciation is possible with targets towards 1.2900 and 1.3000 zone," said Valeria Bednarik, chief analyst at FXstreet.com.

[mynameisandhy]

News and Review of European Economic Zone (France)

 

Bank of France: Q3 GDP Probably Natural Depreciation

Monday, September 10, 2012

 

France's economy is likely to shrink in the 3rd quarter after stagnating during 9 months, the French central bank said in a statement on Monday. It indicates if the slowdown in the second largest economy in the Euro zone increased.

 

Economy worth € 2 trillion ($ 2.56 trillion) expected to suffer a contraction of 0.1% during the period from July to September, based on projections of Bank of France. The projections also put France under the threat of the first quarterly contraction since the country regardless of the recession in 2009

 

On the other hand, the projection is also adding pressure on President Francois Hollande, who had previously been committed to boost the economy and make adjustments to the budget in a way that does not burden the people.

 

Meanwhile, in a television interview that aired Sunday night, Hollande said that the government has significantly cut its economic forecast for next year to 0.8% from a previous projection of 1.2%. While growth in 2012 is predicted to persist slightly above the zero level.

[mynameisandhy]

News and Review of European Economic Zone

 

Spanish and Italian yields Crawling Up

Monday, September 10, 2012

 

Spanish and Italian bond yields moved higher on Monday, but still traded near the lowest level seen monthly at the end of last week. 2-year Spanish bond yield yield 2.63%, up 10bps at closing on Friday, while 10-year bonds was 5.64%, up 2bps. 2 year Italian bonds to 2:44%, up 4bps, while that for the 10-year yield yield 5:11%, up 5 bps. Analysts said that this week a German court will make a decision on Wednesday unconstitutional. And the FOMC decision on Thursday will be very important to determine next steps for Yield.

[mynameisandhy]

News and Review of European Economic Zone (Greece)

 

Greece Should the Review Savings Plan

Monday, September 10, 2012

 

Troika rejecting some Greek austerity policy plan that Athens now had to think of another way to secure the next disbursement of bailout funds, according to Dow Jones. Troika-which is representative of the ECB, the IMF, the European Commission, rejected an austerity plan worth € 2 billion of the proposed Athens to meet deficit targets for the next two years. The coalition government-which consists of New Democracy Party, Supply, and the Democratic Left-will meet again on Wednesday to find a solution.

 

Yesterday, the Ministry of Finance of Greece and troika officials met to discuss progress in implementing reform policies. Although all sides gave a positive reaction, but talks are still going to take place over the coming weeks. "The talks have just begun. Troika will remain in Greece for a while," said Greek finance ministry officials interviewed Dow Jones.

 

Greece sincerely hope the troika will give a positive report to secure the next bailout fund disbursement. If the troika gives consent then Greece will get € 31.5 billion disbursement next month which may mostly be used to nourish the banking sector.

 

Meanwhile, the euro weakened on the London session. EUR / USD is now trading 1.2780, moving away from a daily high level 1.2808