36 Burst results for "ECB"
Bloomberg Radio New York - Recording Feed
Monitor Show 07:00 09-15-2023 07:00
"With Bloomberg, you get the story behind the story, the story behind the global birth rate, behind your EV battery's environmental impact, behind sand, yeah, sand, you get context, and context changes everything. Go to Bloomberg .com to get context. This is Bloomberg Radio. The context around European growth has changed. There are really, across the board, weakness in the euro area to a lesser or greater extent. Resetary risks do linger as we move into next year. I think it's harder to see higher inflation if growth is weakening in the euro area. I think the Fed so far has done a pretty good job. I think the ECB isn't quite there yet. This is Bloomberg Surveillance with Tom Kean, Jonathan Ferro, and Lisa Abramowitz. The words that rock Detroit, we will strike all three of the big three at once. From New York City this morning, good morning, good morning. For our audience worldwide, this is Bloomberg Surveillance on TV and radio. Alongside Tom Kean and Lisa Abramowitz, I'm Jonathan Ferro. Your equity market on the S &P slightly positive on the S &P 500 by 0 .1 percent. TK, it is our top story. Strikes in America. It's got to be a top story, but it's a different strike. I was thunderstruck. Bramo nailed this yesterday. She said, pay attention to 10 p .m. and she was absolutely right there. I was watching Twitter or whatever. Afterthought came in late partying and, you know, I'm up watching and the whole thing and there it was. This is a hyper -surgical strike. This is a strike I've never seen. This is a strike Joe Biden has never seen. Lisa, it's twelve thousand seven hundred workers across three plants. There are three ways to interpret this. Number one, this is digging your heels for a prolonged strike where you can allow your eight hundred and twenty five million dollar strike fund to last. Number two, this is just.
Bloomberg Daybreak Europe
Fresh update on "ecb" discussed on Bloomberg Daybreak Europe
"Since 2011 honestly there are too many superlatives out there for how high these yields have gotten in this this phenomenal curve that we have seen over the summer and continuing into the fall well I think the scariest superlative is these are the highest levels and yields going back to 2007 which doesn't exactly instill a lot of confidence in terms of what comes next Valerie what is the ripple effect here yet to be seen that Kriti we know that what happened last year here in the UK when we had that such volatility in long -end guilt it caused pension funds and insurers to really fall out of bed that one really came out of nowhere is there some risk lurking in the US at the moment for for those holders of this long -end debt I mean some of these 30 -year treasuries are below trading .50 $0 on the dollar now that is just an unprecedented amount of losses that we are seeing in the Treasury market which around the world is known as a safe asset as a safe haven as something you hold because it holds its value that's clearly not been the case in the last two years in the Treasury market but we're seeing gyrations happen elsewhere across emerging markets bit jittery when it comes to this dollar strength causing those emerging market currencies to weaken we saw it in the credit markets yesterday we're seeing credit spreads start to creep wider and some issuers in the US yesterday pulling their deals just due to this treasury volatility we're also seeing it in financial this conditions is something that could possibly be in the Fed's favor in some way financial conditions and now flipped into tightening territory due to the strengthening dollar due to this rise in yields and due to these credit spreads beginning to widen. Crity can we talk a bit about the kind of political implications here as well because of course higher yields immediately means the cost of borrowing for the US government gets even higher and part of this story is is the supply issue around the fact that the US government is borrowing that much more? it Yeah really is and I think part of this is as well and this is something that Valerie could probably weigh in on as well is that you look at the 30 -year yield that is the yield that a lot of people are taking out mortgages on as well just on the surface as well so when you were talking about a crack in the markets the fact that the long end affects the housing market well that's going to affect the broader economy can you imagine going into 2024 when people are hitting all of their or say submitting their ballots and suddenly their household wealth has completely been eliminated or is even more expensive than initially thought those mortgage payments getting higher i think James Carville the political famous political strategist had said it's the economy stupid that's how you decide who's president this isn't i mean why i punctuate that is quite important as well it really is mean but i that that happens to be the sense and i think that's been the concern around why gasoline prices for example are such a political mover but housing is not far behind but this is happening at a time when you know even within the u .s political scene there's more upheaval because kevin mccarthy is now gone a speaker putting essentially congress into status until i figure that out yeah i mean look it's it's not the best time in washington right now we aren't exactly setting a great precedent i want to say in terms of leadership but i think what you have to keep in mind here is that look the shutdown just got a whole lot harder and i think those are the calls that matter from a political standpoint because we're only what six weeks away november 17th yeah is when the u .s government shuts down and look i think just for some kind of inside baseball here or inside cricket as i believe it's called on the side of the ocean is is basically that one of the major issues the of spending bill has been you can't touch defense spending ukrainian uh aid has kind of gone out the essentially and then a lot of it is coming down as well as how you tackle eventually what will be the debt load as well and there are calls coming out of goldman that are saying because of the political politicization of this you are now going to see it become even harder to actually hit a bipartisan deal it come november 17th the first people that get hit in shutdown a are your servicemen are your troops and again coming from the south that is a real sticking point for lot a lot of the folks who are very passionate about our army and you have to wonder whether the markets really are going to force some political change when it comes to washington and just how much money they're spending because i'll give you some shocking stats uh 30 of treasuries have to be refinanced in the the next 16 months and a lot of questions are now being raised as to whether those debt financing costs are going to become too much of a burden to the u .s government and possibly push the path towards fiscal unsustainability we had a call out from goldman yesterday noting that they see interest expense rising to four percent of gdp by 2030 that is a shocking statistic it has not has not gone much above two percent i think the highest it was was back in the 1990s where we've reached two percent but if we're really headed for this higher for longer situation in the bond market the u .s government could be the first first casualty of that yeah valerie can we talk a bit about the international impact of this as well because i mean we've seen the german yield curve is uninverted in the past few minutes because we've seen the the 30 -year yield move above where the two -year yield is the 10 -year german bundle and over three percent for the first time since 2011 this is a story that is is rippling through markets across the world it's rippling through and let's be clear the central bank in europe central in the bank here in the uk have really no control over what's going on this will tighten financial conditions globally as we see yields rise and that is not something the ecb or the bank of england can necessarily fight this is being led by the u .s and let's be honest even in the u .s the fed really does have no over long end yields unless they intend on embarking again on quantitative easing which is something i don't think they have necessarily on their radar so this is going to be a very very hard thing for not just politicians but for central banks to fight the other aspect of this of course to think about is is where we see the other asset classes essentially as as i look across the sea of red on my bloomberg terminal this morning as well i mean when we're thinking about what happens next in this story valerie where do we need to watch for what might either accelerate this further or potentially bring some calm to markets well my my mind goes straight to the big data we have on friday we get the monthly payroll report out of the u .s
Bloomberg Radio New York - Recording Feed
Monitor Show 07:00 09-14-2023 07:00
"The U .S. Border Patrol has exciting and rewarding career opportunities with the nation's largest law enforcement organization. Earn great pay with outstanding federal benefits and up to $20 ,000 in recruitment incentives. Learn more online at cbp .gov slash careers slash USBP. Bloomberg Business Act. This is Bloomberg Radio. The consumer is stretched here, right? We have to pay attention to that. Whichever way you look at it, inflation is too high. The Fed has to, we think, rates can still move higher and I think that's a really important thing for us to remember. The market has not fully bought into this disinflationary trend idea. I think we're actually going to go into a mild, short recession going into next year. This is Bloomberg Surveillance with Tom Kean, Jonathan Farrow and Lisa Abramowitz. Live from New York City this morning. Good morning, for our audience worldwide. This is Bloomberg Surveillance on TV and radio. Alongside Tom Kean and Lisa Abramowitz, I'm Jonathan Farrow. Your equity market is positive, near session highs up by 0 .4%. Later on this morning, U .S. retail sales and jobless claims, before we get there, an ECB rate decision. Later on tonight, Tom, we're expecting a news conference from UAW, the big union taking on Detroit's big three, because two hours after that, 10 p .m., news conference, potentially, Tom, midnight is that deadline to strike a deal with Detroit's big three. I just went to our engineers in our control room, the team that we've got with our interns and, you know, they use chat, GTP, GPT and all that AI stuff. I want three countdown clocks today. We need three. What are your three events? 8 .30, 10 p .m., like ECB economics, 10 p .m., and then 12 midnight. We'll see if Cinderella comes out and gives us a strike. Pick a story.
The Cryptoshow - blockchain, cryptocurrencies, Bitcoin and decentralization simply explained
A highlight from #461 DANGEROUS: FTX SELL OFF!!!
"Welcome to The Crypto Show, your podcast for everything around crypto, blockchain, bitcoin, and more. Here is your host, international blockchain expert, serial entrepreneur, and investor, Dr. Julian Hasp. FDX is selling cryptos. This, after an entire year of basically FDX being shut down, this may confuse you. And so I want to make this video where I explain all this. We're going to discuss obviously the FDX stuff. We're going to discuss what else could be affecting the markets this week. There are some updates on inflation. There are some updates coming out of Europe. So all of this is going to have a bit of an impact. This and much more in today's live here. If you're absolutely new to the channel and you have no clue what it's all about, my name is Julian. I'm the CEO and co -founder of The Cake Group. We have several verticals in what we do. We have Bake for retail, getting access to crypto, investing in crypto. We have Levain for the enterprise side. We have birthday research as an R &D arm. We develop for blockchains. I actually just came from the Ordinal Summit here in Singapore that was organized by birthday research. We also have a VC fund. On top of that, I work a lot with the European Union. There's a lot of regulating work going on. And obviously I am a crypto author. I write books. I do a little bit of YouTube. So I try to wear different hats. And I try to make this as rational and reasonable how the crypto world works. I try to stay as intellectually honest when it comes to certain topics. If you love this stuff and you also want to become crypto fit, then I would love if you give me a subscribe and follow here on the various channels. With this, let's dive in. I got my notes here, so I'm going to open them so I know what I'm talking about and all the things that are happening. Well, I think in general, over the past weeks, we've seen a very, very kind of stable market. Most of crypto has actually been more like stable coins. It's been very, very difficult to generate much alpha, getting a lot of returns. A lot of it was a bit of waiting and just a little bit of suffering as well. Yesterday in our office here in Singapore, I held a meetup where we held a meetup where I gave a talk. And in that talk, I talk about if you actually look back all the way pre -pump in June. So this is three months ago. We've been actually sideways since then. So now all this ETF hopium that we've had is kind of gone. And sadly, Bitcoin is going into a death cross, meaning there's a high, high, high risk that we're seeing a 50 % selloff in Bitcoin. Now, the other coins are not as bad, but many times the charts are not so crucial about this. Many, many times the fundamentals are more important and what actually happened in the real world is going to show on the chart. And it's not that the chart dictates what people do in the real world. On top, the US dollar, surprisingly, very, very strong. And that also has to do with some hopium that the Fed is done raising their rates in eight days. Next week, we're going to have an update on interest rates. And so people are expecting that we're not going to see much of a change. We're going to stay at 5 .25%. It's obviously also interesting because on Thursday, the ECB, the European Central Bank, is going to make an interest rate decision. And it looks like they're going to halt as well. So I think that's in the whole grand scheme of things, I think, important.
Tech Path Crypto
A highlight from 1248. Coinbase Stablecoin Master Plan Revealed!
"All right you guys don't want to miss this one. It is gonna be breaking down what is in store for stablecoins but also what is happening on more of a global footprint. There's a lot of things happening around the G20 that may have some influence on the crypto markets I think in a long -term scenario and we're gonna break all that down for you today. I think you'll like it. My name is Paul and this is the topic of an alternative stablecoin and what that might look like. This was FX Street kind of coming in on CEO Brian Armstrong talking about stablecoin hot take. This is the whole idea around flatcoin. He mentioned this I'll show you the video here in a second but basically he told Yahoo Finance basically in an interview that the next iteration of stablecoins, flatcoin, is on the horizon for the exchange. Now the point is will and are exchanges like Coinbase really going to focus in on this? And one of the things that I think is interesting here is the fact that we're seeing Coinbase move in this direction almost in unison and lockstep with what's happening in DC. And a lot happening this month most likely we'll have a house vote on stablecoins and it's very possible we could get some regulatory clarity. So I think they are queuing up for it. I want to say they meaning Coinbase queuing up for it. Remember they recently listed that they were doing and or going to list PayPal stablecoin on the exchange as well. So the idea behind these flatcoins is kind of interesting. There was a video here on this. Let me just jump over here to this video real quick. And this is where he kind of breaks it down but listen in to what he had to say. And so what would it look like to have a better form of money in the crypto space? Well it'd be something that's decentralized and maybe tracks CPI. So CPI is the consumer pricing index. It essentially has a basket of goods underlying it. Things that people spend their money on. You know a place to live, transportation, commodities like you know food and energy and wheat and you know copper things like that. And so we actually that is a good property of money. We want our money to preserve its purchasing power. All right so I'm gonna stop it there. Want our money to preserve purchasing power and the idea around tracking this against things like the consumer price index which is highly connected to inflation in general. And I think you know there are some interesting scenarios that maybe play into this for what they're trying to do. And I and I would agree with what Brian is talking about. Now remember this video that he just did was the ideas that they were trying to get behind. These are the ideas that they feel should be in the marketplace and would support. And they had a whole line list of ten different great ideas that you know Coinbase didn't have time to build everything. So it's something that I think a lot of markets are now starting to understand maybe how this connects to more of a global aspect. A couple other points you know to kind of hit within this. Coinbase CEO Brian Armstrong also said the company is working on the next generation version of Stablecoin and that there may be a new SEC chair by 2024. So he's definitely maybe maybe either that's wishful thinking or you know something else. But they're also talking about donating to a presidential candidate who supports cryptocurrency. I think right now with Ramaswamy he's probably the one that most likely will be maybe a candidate that could go in that direction along with RFK juniors. So there's there's some interesting political scenarios playing into that. And when you think about political you know and how that plays into it you have to look on the global scale of things. But I look at Coinbase also just in their current size because Coinbase I think is one of those you know kind of the tail that wags the dog kind of companies. And if you look at just where they are currently there's just your recent data. This is their Coinbase revenue and usage stats for 2023. There's a lot here. I mean first of all Coinbase expecting to get revenue around 7 .3 billion in 2023 which is a significant increase of 2 billion just in Q2 of 2021. That's a very big jump in a market in which has been almost a full bear market since 2021. So that's a big deal. Also in terms of user stats let me kind of zoom in on that for you guys projected to have around 150 million verified users by the end of 23. Now the reason I think that's important is when you look at what happened with PayPal we talked about this if you haven't watched our PayPal video go check it out because PayPal has around 450 million users another 50 million Venmo users. So 500 half a billion people but only a small fraction of that might use the PayPal stablecoin versus if you look at Coinbase projecting 150 million verified users by the end of 2023. That is a much more captivated audience because I would say for anybody that's on Coinbase most likely you're probably talking in excess of 50 to 60 percent that are holding stablecoins and especially right now where Coinbase is rewarding USDC holding with a high percentage of yield interest that's being paid. So when you think about that the size of the market then all of the implications that rolls into the global spec of things and then the size of Coinbase themselves and the number, remember they're a global company and they're growing and continuing to grow outside the US, could become very interesting for what is going to happen around the stablecoin market. Another factor that you might want to look at is what's happening with the European Central Bank this week ahead of the ECB taking center stage as the euro is obviously dealing with some challenges here. A couple of things I wanted to look at. Problem for the euro is interest rate differentials even though the Fed is expected to hold rates steady later this month and the ECB is expected to squeeze in another hike when it meets on Thursday next week. The interest rate differential between the German and the US one -year bond or yield is around 1 .8 percent. This is a problem for the future of what is happening in the European Union and I think this is also playing out globally. Now why is this interesting or important around stablecoins? Because if stablecoins start to become a regulatory product and become very active within the financial system we're gonna start seeing a lot of countries adopting the use case for stablecoins which will only cause massive growth. Now you look at other major Western countries. Let's take a look at Canada.
Bloomberg Radio New York - Recording Feed
Monitor Show 07:00 09-12-2023 07:00
"659 on Wall Street. Stay with us. Bloomberg surveillance with Tom Kean, Jonathan Farrow and Lisa Abramowitz starts right now. Broadcasting 24 hours a day at Bloomberg .com and the Bloomberg Business Act. This is Bloomberg Radio. Center banks around the world, both developed and emerging, are fighting inflation. I really think it's about ECB policy, how that relates to Fed policy in this US dollar. The consumer remains strong, so there kind of continues the challenge that the Fed has. The last mile is going to be hard, but I do believe that we are very much on that disinflationary trend. I think we're in this very like hold your breath kind of moment. This is Bloomberg surveillance with Tom Kean, Jonathan Farrow and Lisa Abramowitz. In many ways the week begins today. A from New York City this morning. Good morning, good morning for our audience worldwide. This is Bloomberg surveillance on TV and radio alongside Tom Kean and Lisa Abramowitz. I'm Jonathan Farrow. Your equity market slightly negative by 0 .2 % on the S &P 500. Tomorrow the big data point. CPI just around the corner tomorrow morning. Stateside, before we get there, later on this afternoon a much anticipated iPhone 15 launch, Tom, after a week of weakness from that Apple stock. Can we try to get Apple tied into the CPI report? Can we do one strike? I don't think we can. Higher prices. There it is, you know, there it is. We're going to see it this afternoon. We've got a full Bloomberg technology team. Ed Ludlow, Caroline Hyde. Styling, they're there. Bases loaded, TK. You know, it's going to be there. They're doing, I think they're doing a new iWatch, iWatch not getting much traction. AirPods better get traction. Another set. Well, we've got, we've got an odd set under the couch, so we've got to replenish. With a new set.
Bloomberg Radio New York - Recording Feed
Monitor Show 07:00 09-11-2023 07:00
"Daybreak. I'm Nathan Hager, alongside Karen Moscow. 659 on Wall Street. Stay with us. Bloomberg Surveillance with Tom Kean, Jonathan Farrow, and Lisa Abramowitz starts right now. Broadcasting 24 hours a day at Bloomberg .com and the Bloomberg Business Act. This is Bloomberg Radio. We think there's more downside risk here as we go through the next few months. When the yields move, they're going to move down at a lot. The question is not whether things are declining, it's whether they're declining fast enough. I think positioning has really changed and you've seen that inflection and sentiment in the options market. The bottom line is they fit. Once to slow things down, don't fight the fit. This is Bloomberg Surveillance with Tom Kean, Jonathan Farrow, and Lisa Abramowitz. Live from New York City this morning. Good morning, good morning for our audience worldwide. This is Bloomberg Surveillance on TV and Radio, alongside Tom Kean and Lisa Abramowitz. I'm Jonathan Farrow, your equity market on the S &P 500. Nicely positive here by 0 .4 % following a week of losses and pushing ahead to retail sales on Thursday, CPI on Wednesday, and the main event, Tom, going into the Federal Reserve a week away. I take your point. I think this has not been said enough. There's a Fed meeting after the ECB meeting. It maybe has a little bit of import. Nothing's going to happen at it. It's a dead meeting. It's a live meeting. But, you know, I take your point. You got to get to the Fed meeting. There's some data in front of it as well. But are all eyes on November? I think so. I think we've just leapt forward to a November analysis. The hawks on the committee aren't screaming hike in September. If you listen to the economists on Wall Street, those that think we get another hike, I'm thinking Andrew Holland, Horster City, perhaps Mike Gape and a Bank of America thinking that risk still exists. They're looking to November, Tom, not September. The Fed wants to be patient now. Wait to see if there is further evidence of a re -acceleration of this economy, which leads to an acceleration.
Bloomberg Radio New York - Recording Feed
Monitor Show 07:00 08-21-2023 07:00
"It's 659 on Wall Street. Stay with us. Bloomberg Surveillance with Tom Kean, Jonathan Farrow, and Lisa Abramowitz starts right now. Broadcasting 24 hours a day at Bloomberg .com and the Bloomberg Business Act, this is Bloomberg Radio. This entire economic cycle has felt like it's been on fast forward. All this talk about a recession so far hasn't panned out. This current correction is not about growth fears. What I see is a pull forward of consumption. We are expecting that both Fed and ECB will stay on hold next month. This is Bloomberg Surveillance with Tom Kean, Jonathan Farrow, and Lisa Abramowitz. Getting deeper into summer. Rounding things out. TK can't wait for Labor Day. That's why he's back in the seat. Life from New York City this morning. Good morning, good morning. This is Bloomberg Surveillance. What's that about, TK? Wishing away summer in America. What's that all about? Here's the difference. You guys are always on holiday. People that live on the continent like Francine Lacroix, what they're doing, and Maria Taddeo, they're planning their next holiday where they're on holiday. All we do in America is work. Let me speak for you guys. If we had the weather that you guys had here, which is phenomenal, then I would stretch summer right the way through September. Yes, you guys. What is this generalization? Some of us like vacation. I like vacation. I grew up in America. I think we're both on the same page here. We both like vacation. It's TK that doesn't seem to like vacation, but it's good to have Tom back with us. The equity market on the S &P shaping up as follows. Equity futures right now positive by 0 .4%. Yields are a little bit higher, but that's been the theme, Tom, on a 10 -year. Back to 4 .30 over the last week. That's a huge debate. We're going to have Julian Emanuel with us dovetailing in with Ed Hyman's economics here in a moment.
Tech Path Crypto
A highlight from 1216. Macro Market Crash Potential w/ Darius Dale
"All right, so today we're going to dive into the market status, take a little bit of deeper dive into some of the implications of what's happening currently, but also take a look at more of a long -term perspective. Typically we like to do that with guests that have, you know, kind of these macro outlooks. I think you guys will like this one. My name is Paul Berra. Welcome back into Tech Path. I want to get into it today with Darius Dale. If you guys are not aware, Darius Dale has been on our show many times. He's the CEO and founder of We're at 42 Macro. KTF you back? Always a pleasure to be here, Paul. Thanks for having me back. Appreciate you. All right, so let's listen. If you guys have not had a chance to catch Darius before on our show, what I would do is invite you guys to jump over to his website, which is just 42macro .com. You can learn a little bit more about what they do in terms of their investment strategy and a lot of their own services. So check that out. We always love to plug our guests out there. So go visit to find out. And he's very active on Twitter as well. So check him out. All right. So I want to get into a few things here, Darius, with you. And that is when you look at the current status of major investment, we'll call them players in the market. You know, whether you look at institutional capital or just high net worth individuals, a lot of people are starting to look at when is the right time to reenter the market. You also have scenarios like this playing out right now. You've got Buffett, Burry, everybody kind of in this position of, hey, we think there's going to be this major crash. We are going to look at stepping away from the market and waiting for that right time. You look at that and the current situation of what's happening today. What are you seeing out there within your own data? So again, thanks for having me. So in terms of like where institutional investors are positioned, we have a litany of clients around the world who are all institutional asset managers, insurance funds, pension funds, et cetera, from my days on Global Wall Street, hence the suit in that photo. So I'm pretty plugged in in understanding kind of where the institutional flows are. And it's pretty clear that over the last sort of six to eight weeks, you've seen a little bit of an upside capitulation into the equity market that we're obviously correcting from now. But one thing I think we're, over the last kind of three to four weeks, particularly since the Bank of Japan amended its yield curve control framework in late July, we've backed in in terms of treasury curve duration. And this is not just a treasury market phenomenon. This is happening globally across global sovereign debt curves. I mean, if you look at some of the moves we've seen just week over week in the treasury market, you're talking about 10 -year yields up 25 basis points, UK gilt market 10 -year yields up 30 basis points, German boon up 10 basis points, et cetera, et cetera. So you're seeing a lot of this return of bond market volatility. And I'll tell you, Paul, it's happening for two factors, one, economic resiliency in the US and Japan, which we can unpack, two, the inflation resiliency in the eurozone in the UK, which we can unpack, but all those factors are combining to create a little bit more bond market volatility, which the markets are feeling right now. Nasdaq had a little bit of a lift today, almost 3%, also playing into that. But OK, so a couple of things. We've had a chance to talk with a few other crypto analysts outside of the overall market side of things. And they have different viewpoints on where this current market sets. If you look at some of the global factors that are playing out right now, let's take a look at China and the EU in general, because those are kind of polar opposite stories. Talk to me about which one has the most potential impact of what's happening here in the US. Yeah, so I would argue in terms of what's happening here in the US, it's very clearly the sticky inflation story that we continue to see in Europe. If you look at core inflation in the eurozone coming in sticky at 5 .5 % in the most recent month, you have core inflation in the UK coming in sticky at 6 .9 % in the recent months, surprising consensus estimates to the upside. That's creating bond market volatility and expectations for not only more tightening in those localities, the ECB, Bank of England, but actually delaying the rate cuts that are currently priced into forward curves as well. And that's obviously a spillover impact here. But I would argue the number one thing that's causing problems in the US equity market in the recent weeks is the resiliency of the US economy, because ultimately it's pushing out expectation the that the Fed is going to be able to cut interest rates any time soon. Interesting. Summary of Fed minutes right here. Most officials still see the need for higher rates. This came from COBEEC letter. Officials worry a little bit about over tightening. They see kind of tighter bank credit conditions. We've kind of expected some of that. No recession in 2023. We still are getting that indicator from the Fed. And then the one that I'm still most concerned about is the CRE situation, commercial real estate, around both the value in its current situation. I've been talking to a lot of real estate people here in Miami, and Miami is typically one of those markets that rarely gets affected by what happens here in the US and abroad outside of maybe Los Angeles or even New York. But now Miami also starting to feel the pinch around CRE. With all of those things and based on the Fed minutes, where do you feel like this is coming out of the Fed itself? Yeah. So in our view, we think by the end of the year, we're going to be having a different discussion around inflation. Recall that inflation has been trending lower really since the fall of last year in a pretty spectacular, albeit immaculate way. We've been calling it immaculate disinflation amongst Wall Street participants because we understand that there's really no time series history or evidence to suggest that we should be seeing these types of positive inflation outcomes ahead or not in a recession. Typically what happens is you get the breakdown in inflation several quarter or a couple of two to three quarters after the recession begins, and so clearly we're not in recession. The economy seems to be booming, certainly being resilient. And so from the perspective of the Fed, I think by the end of the year, you're going to have a couple of things happen. Right now we have zero incremental rate hikes priced into the Treasury curve. I think that's wrong. By the end of the year, it's probably likely that we're going to start to see inflation stabilize at levels that are unpalatable to the Fed relative to their price stability mandate. And actually, let me take that back. I don't want to be too specific about December 31st, but I do believe in the next three to six months, the inflation narrative will evolve from immaculate disinflation to sticky inflation because the economy is showing resiliency and that's persistent. So you feel like it's still going to hold. We're not going to see a full drop off of inflation to where Chair Powell is wanting to go to a 2%. This gets back into the theories many people have talked about, 3 % more likely as a potential. What do you think is going to be that new target zone? Do you think the Fed is just going to do everything they can to still move to that 2 % target zone? Or do you think they're going to have some sort of acceptance slightly above that? You can make the case that they already kind of are. Their reaction function is certainly downshifted to a one that's a little bit more asymmetric or not asymmetric, a little bit more symmetric in terms of responding to shocks of growth, shocks of inflation. Clearly inflation is still in the driver's seat, but it's no longer in the driver's seat the way that it was six months ago when they were hiking 75 basis points at a time. To answer your question, I do believe, so the one thing, this thing about inflation cyclically and secularly, real quick on the cyclical side, we still will see that there's a considerable amount of downside momentum in the time series, particularly when you analyze inflation through the lens of the sequentials like three month annualized, six month annualized. It's going to drag the year over year time series for things like core PCE, super core PCE, trim mean PCE inflation down over the next few months. We suspect that will probably conclude in the next three to six months. From a secular perspective, this is where I think it really gets interesting and why we've been appropriate to be bearish on bonds all year. The reality is there's a couple of things. One, the Fed's going to have to change its 2 % inflation target. We run a very sophisticated dynamic factor model that we've been presenting all across global Wall Street for the past few years, just sort of describing all the different changes that have happened in the global economy from a DSGE perspective that suggests the underlying trend of core PCE inflation has migrated from around 1 .6 % to 3%. Now, that doesn't sound like a lot if you're talking about cryptocurrency or the use to explosive logarithmic moves, but the reality is the Fed has a 2 % inflation target. If the trend in the time series is persistently above two, it means they're going to consistently be leaning against the investors, consistently be leaning against the economy, and I don't think that's politically palatable in a fourth turning society. I think they're going to have to revise their inflation target because ultimately they're going to be the ones responsible for gobbling up the $1 .5 to $2 trillion budget deficits we can see as far as the eye can see.
AP News Radio
Europe's inflation inches up ahead of interest rate decision
"Europe's inflation goes up ahead of an interest rate decision. The blocks painful inflation inched higher last month, extending the squeeze on households and keeping pressure on the European Central Bank to unleash another large interest rate increase EU agency eurostat says consumer prices jumped 7% in April from a year earlier from the annual rate of 6.9% in March, food prices have eased a little while core inflation which excludes volatile food and fuel, slows slightly but was still high at 5.6%, all this data underlines the expectation that the ECB will press ahead, with its campaign to beat inflation into submission with rate hikes. I'm Charles De Ledesma
The Crypto Overnighter
"ecb" Discussed on The Crypto Overnighter
"Quote, we must strike the appropriate balance to protect consumers without stifling responsible innovation. The hearings are expected to focus on a number of issues. Some topics are the regulation of stablecoins. The role of the SEC and the CFTC, as well as the taxation of crypto assets. They said that they plan to introduce legislation in coming months to provide regulatory clarity to the crypto sector. And speaking of taxes, a new study by researchers at Indiana University and the university of Maine is calling for a new tax framework for cryptocurrency losses. This study was published in the journal tax policy and the economy. It argues that the current tax treatment of crypto losses is unfair. They say that it encourages investors to take on too much risk. At present, investors can deduct crypto losses from their other crypto gains. However, researchers argue that this encourages investors to invest in crypto even when it's not a good idea. Quote, this risk sharing can encourage investment in cryptocurrency and away from other investment activities of value economic significance. The researchers propose a new tax framework, one that would allow investors to deduct crypto losses only from their crypto gains. They argue that this would discourage investors from taking on too much risk and help stabilize the crypto market. The study's findings will be likely welcomed by many crypto investors who have been frustrated by the current tax treatment of crypto losses. However, whether the government will adopt the researchers proposed tax framework is unclear. The European Central Bank is working on a digital Euro. Even so there are concerns about how it will affect the banking industry and its consumers. The ECB has released a new report on the digital Euro. In this report, they outlined three use cases. Person to person payments, consumer to business payments, and payments to or by the government. Now, some banks are concerned. They're worried that the digital Euro could threaten their business models. Jerome grey is the deputy CEO of French bank credit Agricole. He said the digital Euro could quote compete with their collection activity and disrupt their financing capacity. Still others are concerned about the impact of the digital Euro on consumers. Burkhardt balsa is a member of the executive board at Deutsche bundesbank. And he said that the ECB should avoid extending its footprint in the ecosystem too much. Specifically by having the private sector run the distribution of their digital Euro. The bank said that it's still in the early stages of planning for the digital Euro. They said that they will take into account the concerns of both banks and consumers. In other news, Mastercard has launched a new web three solution to enhance user verification standards and to reduce the opportunities for bad actors in the digital asset space. The solution is called Mastercard crypto credential. It will issue users a unique identifier. Now this identifier can be used to verify their identity on web three platforms. Mastercard said that this solution will help reduce fraud. It will also make it easier for consumers to transact in digital assets. Now Mastercard is not the only company working on solutions to address the challenges of web three. Other companies are also developing products and services to make it easier for consumers to use digital assets. As we watch the web three ecosystem grow, it becomes clear. There is a need for solutions that address security and fraud challenges. Mastercard is one such example of a solution designed to address these challenges. And finally, our cover story for the night, remember Alex hertz, he's the developer at tornado cash, who was arrested in August of 2022. It appears that he was released from prison. Apparently, he's now back on Twitter. Was arrested in connection with the U.S. government's sanctioning of tornado cash. His arrest sparked criticism that he should not be penalized for developing open-source code. It also raised questions about the future of law enforcement actions against distributed protocols like tornado cash. Protocols where the creators no longer have control. In other news, Tesla CEO Elon Musk has announced that creators on Twitter can now monetize their content using this new subscriptions feature. This feature allows Twitter users to charge their followers a monthly fee to access exclusive content. Twitter will allow creators to keep 97% of the revenue up to $50,000 in lifetime earnings. After which, the revenue split will be dropped to 80% for creators. This revenue share will only begin after the users earn the minimum threshold of $50. The subscription services are non refundable, even if the creator's Twitter account gets suspended for any reason. Musk has also reportedly purchased nearly 10,000 graphics processing units to build AI tools that will detect and deter misinformation on Twitter. Which is interesting, given his recent warning against AI development due to societal concerns. And I'm kind of with him on that last. I don't worry so much that AI is going to nuke us out of existence or enslave us or anything like that. However, many of this societal issues AI will bring, we're really not even ready to talk about. And that's going to do it for us tonight. I want to thank you my listeners because when you stop listening, I will stop talking. If you enjoyed tonight show, then please, like follow subscribe, leave a rating, maybe a review. And in the meantime, we'll see you tomorrow night.
The Breakdown
Apparently, U.S. Regulated Banks Are Riskier Than Stablecoins
"All right Friends, well, today we are going to discuss the delicious irony of why, despite all the teeth gnashing of politicians, it wasn't stablecoins that disrupted the regulated financial system, but the regulated financial system that disrupted a stablecoin. First though, I want to do a few follow-ups from things we've discussed over the last few days. Yesterday we talked about Credit Suisse. You'll remember that markets were freaking out about it and pricing in a huge chance of default. After their biggest investor said absolutely not to further investment. As we discussed, despite the fact that its problems were quite different than Silicon Valley banks, having another bank in peril so close to last week's dramatic events inherently connected the two. Well, today, Credit Suisse has posted a record surge of as much as 40% and has seen major drops in their default swaps. The big update is that they were able to open up a CHF 50 billion credit line with the Swiss national bank, which is about $54 billion U.S.. They also announced plans to purchase some senior debt to the tune of about CHF 3 billion. So seems like the European banking crisis is over, right? Well, enough so that the ECB hiked rates by 50 basis points today, and I guess we'll have to see how that plays out over the next few days. Meanwhile, back in the U.S., all eyes have been on first republic. Indeed, before the New York department of financial services decided to off signature bank over the weekend, most believe that first republic was the most likely next U.S. domino. Well, on Sunday, first republic reported that it had more than 70 billion in unused liquidity from agreements with the fed and JPMorgan Chase, but its stock still cratered this week. Given that, word is that they're exploring a sale. Unlike SVB, silver gator signature, no one industry makes up more than 9% of first republics depositor base, and their emphasis on private banking and wealth management seemingly make them a juicy target. JPM is one that many have mentioned in conjunction with the sale, but it seems like others, including Bank of America subsidiary Merrill Lynch, and Morgan Stanley might also be interested.
CryptoCompare
Market Analysis Report 16 Feb 2023
"10 a.m. Thursday, February 16th, 2023. Market analysis report, February 16th, 2023 SEC pushes for tougher crypto custody rules ECB advises banks to apply caps on crypto holdings interactive brokers launches crypto trading for professional investors in Hong Kong.
AP News Radio
EU foresees economy improving, but inflation still painful
"The European Union for sees the region's economy improving, but inflation remains painful. The executive commission has raised its economic growth forecast for the year. Now up the .8% for the 20 countries using the Euro currency. That means the commission expects the Eurozone to scrape by without a technical recession in 2023, but things are not great either inflation may have passed his peak, but it's still high at 8.5%. That's going to keep holding back consumer spending, and the European Central Bank of the ECB is raising interest rates a step that's aimed at getting inflation down, but also makes it more expensive to get to credit for purchases or business expansion
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"We've seen a lot more positive sentiment come back into the financial market. 183,000 is the number expected tomorrow by economists surveyed by Bloomberg. That's down, Carol, only 3000 from the last month of 186,000. We'll see if there are revisions though. Yeah, exactly. That's a good point. And we'll see what's going on with wages and the cost of wage increases. All right, this is Bloomberg. Bloomberg radio on demand and in your podcast feed. On the latest edition of the Bloomberg surveillance podcast on Lagarde in the ECB, holger schmeling of Berenberg bank. What we are seeing is that Europe as a whole is not falling into a winter recession, but in what you could call a winter stagnation. Germany most exposed to Russia is having a contraction in its GDP, but some of the other countries, especially France and Spain are making up for that. They are not as exposed to Russia as Germany and not as exposed to some downturn or weakness in global trade at the moment. And this is of course good news that the region Europe, which really last year was the focus of all the bad news, war in Europe, energy, shock that Europe is now actually outperforming expectations. Olga, do you think that in the ECB press conference, madam Lagarde should push back on the market activity, perhaps more aggressively than Jay Powell did yesterday? That is quite possible. After all the ECB has de facto pre announced, they're going to do another 50 basis points in March. Thereafter, however, they will reevaluate their approach so that leaves the door wide open to going just up 25 basis points in May. And beyond that, we'll have to see the press conference may provide some clues, but probably the ECB has not made up its mind yet or what happens after March to Lagarde probably can not give us clear guidance relative to the said what is clear. Having started later still has some more room to go to the upside than the fed from
AP News Radio
ECB Raises Interest Rate by Half Percentage Point
"The European Central Bank has raised interest rates and vowed more to come as the Bank of England also went big with a half points hike. The ECB pushed ahead with its drive to subdue inflation by raising its key benchmarks by half a percentage point. At a news conference in Frankfurt, ECB president Christine Lagarde said a further rate hike will come in March. Now you will say, well, yes, but what about after March? Does that mean that you have reached the Pinnacle or
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"To stay there. And I think Marcus just aren't really paying attention. So we feel comfortable with the view that the fed's going to go up another 50 basis points from here and then stay there until a sort of middle of 2024, at least. What about the ECB then how much further can the CB hike and when do you think we might start to see a part a pause or even rate cuts in the ECB? Well, the ECB has a nice cross analyst, basically told us what they're going to do. So in December, Christina of our very clear message, at least the number two read high 50 basis points and that's what we're expecting and then another final rate in May 25 basis points. So we're looking at another 125 basis points from the ECB, which means that this year the speed is going to be the most aggressive Central Bank in terms of tightening to figure this started quite late in the game. By the middle of the year, they'll be ready to stop and there is no perspective here either of any rate cuts for the foreseeable future because in the Eurozone, the inflation 2024 is going to be even higher than it will be in the U.S.. So same picture really rates my and then a pause at a restrictive level. And I think that's what we should expect in ECB. Does it make any difference that the German government now doesn't expect to contraction for Germany. You've pointed out that you a dollar has been stuck in a kind of very narrow range for quite a long time. Do you think that there is any possibility that that changes the Euro dollar outlook? I mean, the fact that, okay, let me just start with the recession. I mean, yes, everyone going into the winter everyone in excuse myself and that absolutely quite pessimistic. We were very worried about energy supply, et cetera, et cetera. And things have improved since it's not become quite as dire as we anticipated, partially because the winter hasn't been as cold as the earth. And so we're looking at a brighter out of the 2024 than the employee had three months ago. So that's good. In the year has benefited from that. Definitely. But the fact that the Euro dollar has not managed to actually take a real stop one ten. I mean, it's always just below makes me wonder whether maybe we've seen we've seen the brownie that we're going to get for an hour at least on the base of this picture that we are going to have a bright out of three Europe the fed the market is anticipating the fed to cut. We're looking at a 125 basis points on the ECB. And yet, despite all of that, your dollar is already above one ten. And I think there's a risk that failure to move higher now could mean that we're going to be traced back. But I see this pretty where the fact that we're very close to the far away from some tenant might just exert as a magic pool, but I'm not that bullish. Contrarian view, I think, at the moment. Okay, well, we love to hear it signing Martin. Thanks very much, hello, FX research at DZ bank as well for your views on all of that. The Euro today up by a tenth of 1% one O 9 is where it's trading against the dollar this morning. That is the latest from Sonya Martin, head of FX research at dz bank. Coming up next on Bloomberg daybreak, Europe will be bringing you one of our big interviews with the royal bank of Canada CEO that's Dave Mackay. He says that a massive consumer cash buffer will likely help the country
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"The fed, the Bank of England, the ECB. There is a real dichotomy in terms of the inflation profiles that we're seeing from those requisite central banks and the pace of the moderation in terms of the Eurozone is very, very glacial in effect. And of course, as you quite rightly say, those core inflationary pressures are going to be pronounced over the medium run. And that is going to be a real difficulty for the European Central Bank. So I think in the context of some of the discussions you are having after the bed last night, so who has the greatest potential policy problem or policy dilemma then I think the ECB definitely falls into that remit because, of course, as we know there are those fragmentation risks as well. So it's going to be very difficult to see how the CV is going to be able to square the circle by trying to type in policy, but without creating a significant degrees of uncertainty against what is still a backdrop of very elevated and amplified core inflationary pressures. And they do concede that the Euro area economy may contract in the current quarter and next. So there is a hint at that recession, although not necessarily coming out with the same kinds of prognostications as the Bank of England. Also talking about food and underlying inflation, Germany, is the ECB, which I think it was a lot more interesting in terms of these statements than the Federal Reserve, is the ECB just sort of getting ahead of what the federal have to deal with in recognizing a stickier inflation for a longer period that goes beyond what the markets are currently allowing for. Yes, I think that's true. I think we are going to see core inflation proven to be remarkably sticky. So yes, we can see headline inflation pressures gradually easing if we are correct in assuming that those energy forward curves are correct. Catch more of this and other conversations on today's Bloomberg surveillance podcast. Subscribe
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"The fed, the Bank of England, the ECB. There is a real dichotomy in terms of the inflation profiles that we're seeing from those requisite central banks and the pace of the moderation in terms of the Eurozone is very, very glacial in effect. And of course, as you quite rightly say, those poor inflationary pressures are going to be pronounced over the medium run. And that is going to be a real difficulty for the European Central Bank. So I think in the context of some of the discussions you are having after the bed last night, so who has the greatest potential policy problem of policy dilemma that I think in the ECB definitely falls into that remit, because of course, as we know, there are those fragmentation risks as well. So it's going to be very difficult to see how the ECB is going to be able to square the circle by trying to tighten policy, but without creating significant degrees of uncertainty against what is still a backdrop of very elevated and amplified core inflationary pressures. And they do concede that the Euro area economy may contract in the current quarter and next. So there is a hint at that recession, although not necessarily coming out with the same kinds of prognostications as the Bank of England. Also talking about food and underlying inflation, Germany, is the ECB, which I think it was a lot more interesting in terms of these statements than the Federal Reserve, is the ECB just sort of getting ahead of what the federal have to deal with in recognizing a stickier inflation for a longer period that goes beyond what the markets are currently allowing for. Yes, I think that's true. I think we are going to see core inflation proven to be remarkably sticky. So yes, we can see headline inflationary pressures gradually easing if we are correct in assuming that those energy forward curves are correct. Catch more of this and other conversations on today's Bloomberg surveillance podcast. Subscribe
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Bank and the signal. They've got more work to do. Going into a decelerating economy and some sticky inflation. There are no textbooks that describe this. This is absolutely original monetary policy. And this goes back to vimto eisenberg and the advent of this pretreat, as well. It's completely different structure. I think of no real QE one. QE one Q three. This is QE minus one. QE minus two that we're dealing with here, the single headline John IC, and this will be good to get into Jeremy's stretch, head of G ten FX. At CIBC, is what they do, which we don't do as they go out three years to 2025, and there's a miraculous conception of inflation plunging. There's no other way to put it from an 8 level down to a stunning 2.4%. That is optimism of certain level. Jeremy stretch in all your years of Central Bank watching, can they get out near three years? And look for an inflation, a disinflationary trend is the ECB publishes today, or is that wishful thinking? Well, I think it's interesting that the ECB are still anticipating that inflation will still be above their target threshold by the end of 2025. I wouldn't have been surprised that the ECB felt it would appropriate or at least the ECB staff had attempted to try and find a narrative that allowed the inflation profile to get back to target, but clearly because of the upward revisions that we've seen in the profile for both this year and next year. It is going to be very, very difficult to see, or it's going to be a very tough ask for the ECB to be able to force or drive inflationary pressure down without probably a greater degree of economic dislocation that they're currently pricing into that forecast. So I think perhaps a little bit too ambitious to optimistic in terms of the growth trajectory and if we are going to see inflation falling back, it is going to be a very much a challenge that is going to have to be met by probably a more aggressive policy reaction than the market has been or certainly we have been considering. Well, yields are climbing in response to that, particularly at the front end of the bund market, your German two year is up by 11 basis points to two 22. The ten years up by 8 or 9 basis points on a ten year right now to around about 2%, 2.02%. Forgive me for throwing so many numbers at the wall, but I do want to go through the inflation projections again from the ECB. We now see average inflation reaching 8.4% in 22 before decreasing a 6.3% in 23 with inflation expected to decline markedly over the course of the year. These are still really high prints Jeremy, just to go through core and their projections there. Projected to average 3.4% in 24 2.3% in 25. That's headline. When you strip out food and energy, that's projected to be 3.9% on average in 22 and then rise to 4.2% in 23. Can we just talk about that clip higher Jeremy that they're looking for in core inflation through next year? Your thoughts on that and just how far they can push the terminal rate. Given what you expect to happen with GDP on what they're looking for as well. We use that's right. I think that, I mean, I think when you were obviously been talking a lot about the fed projections over the course of the last 12 hours or so in a real dichotomy in terms of the inflation profiles that we're seeing from those requisite central banks and the pace of the moderation in terms of the Eurozone is very, very glacial in effect. And of course, as you quite rightly say, those core inflationary pressures are going to be pronounced over the medium run. And that is going to be a real difficulty for the European Central Bank. So I think in the context of some of the discussions you are having after the bed last night, as to who has the greatest potential policy problem of policy dilemma, then I think the ECB definitely falls into that remit, because of course, as we know, there are those fragmentation risks as well. So it's going to be very difficult to see how the ECB is going to be able to square the circle by trying to tighten policy, but without creating significant degrees of uncertainty against what is still a backdrop of very elevated and amplified core inflationary pressures. And they do concede that the Euro area economy may contract in the current quarter and next. So there is a hint at that recession, although not necessarily coming out with the same kinds of prognostications as the Bank of England. Also talking about food and underlying inflation, Jeremy, is the ECB, which I think was a lot more interesting in terms of the statement than the Federal Reserve, is the ECB just sort of getting ahead of what the federal have to deal with in recognizing a stickier inflation for a longer period that goes beyond what the markets are currently allowing for. Yes, I think that's true. I think we are going to see core inflation proven to be remarkably sticky. So yes, we can see headline inflationary pressures gradually easing if we are correct in assuming that those energy forward curves are correct. But core chlorination in terms of service driven inflation I think is going to be much more challenging to drive out of the system and it may well be the case that we see many central banks facing difficulty to really squeeze or inflation back towards target thresholds over a two year forecaster rise. And so in a sense, that's why it's still interesting that the ECB are still struggling to get back to their target threshold even in year three and that just underlines that inflationary pressures I think are going to be much more pronounced and stickier, particularly if we're going to see wage growth remaining relatively elevated because of still relatively tight labor markets, even if we're seeing a moderation in macro activity. What a challenge. Jeremy stretches CIBC. Thank you. Yesterday, the Federal Reserve projection for 2023, GDP, 0.5. The ECP projection for 2023, 0.5. And acknowledgment of perhaps a technical recession so caught technical recession, whatever that means, contraction in the current quarter and the next quarter. They say it owes to the energy crisis height uncertainty. Weakening global economic activity and tighter financial conditions. And you're all going to love this at home because you've heard this a million times. According to the latest Euro system staff projections, a recession would be guess what, Tom. Short lived and shallow. That's the projection from the CCB. The headlines here are so many I hope that Lagarde addresses this. The comedy of their presumed inflation decline, I'm not going to say I've never seen it before, but it's right up there. It's stunning. What they're looking for to get to back to
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"If you compare the development of the road towards the U.S. dollar, you'll see a certain decline and therefore, and that might also be in the end. Of course, make imports more expensive and import inflation. So I think the ECB has all these things in mind. It acts pretty much in line with what other central banks are currently doing. The German deputy finance minister seems to be happy with the ECB, which is a change from the last ten years because this time the ECB is hiking interest rates. It's not cutting. And it's going to cease end bung bank and maybe execute QT. That decisions about 50 seconds away, Tom and going into it. We have a wicker Euro Euro dollar. Still, just above parity, Euro dollar on the session, Dana half of 1%. Clearly the tone I had Washington with axel Weber is the vector here of ECB is calming to the Netherlands and to Germany. The happier with this. They begin the morning happier. Well, later I said it was the last ten years in reverse because it was the Germans complaining about policy being too loose. So now you've got the Italians who predictably with a new prime minister are going to complain about things becoming too tight too quickly. Yeah, well, they also have a different leg right now because Germany has been on the front foot of I don't want to say the offending camp here, but part of the issue in terms of what's been going on in the dependence on Russian oil and all of that. So how much is there a bit of, hey, we need to throw you a bone in order to stay part of the union, which is the reason why there might be more willingness by the ECB to close spreads and try to help you move forward with costs. That is the weed link in the economy. Right now without a doubt, that decision has just dropped. 75 basis points was the previous number. We got one 50 on the depot race. We go from 75 to one 50 on the depot rate in line with expectations on the marginal lending facility from one 50 to two 25 on the main refinancing rate from one 25 to 2%. So all slap bang in line with what we expected, going into it, you had a week of Euro Euro dollar down about a half of 1%, that's where it stays right now. Starts to roll over just a little bit more. I'll get into the additional headlines in just a moment. You also were higher on a ten year they stay higher by about ten or 11 basis points on a ten year to four 41. As you'd expect, so the ECB expects to raise interest rates further from here. You know, it's interesting so that you're a weakness, just sort of accelerates throughout the session after these headlines and watching right now. 1.0013% of three per dollar, how much can we get this sort of sense? That the outlook is deteriorating. And that's sort of what I'm looking for. And so with the comments that we hear with inflation staying above the target for an extended period of time, seeming to suggest ongoing hikes going forward. Just putting up the statement quickly Tom for anyone following the asset purchase program at the ECB pep and all those other acronyms is the quote for you. The governor castle you're laughing. The governing council tends to continue reinvesting in full, the principal payments from maturing maturing securities purchased under the APP for an extended period of time past the day when it started racing the key ECB interest rates and in any case for as long as necessary to maintain ample liquidity conditions and an appropriate monetary policy stance as concerns the PEP peptide, pandemic emergency purchase program. Let me complete it. I'll get through it. The governor council intends to reinvest the principal payments from maturing securities purchased under the program until at least the end of 24 in any case, the future roll off of the pet portfolio will be managed to avoid interference with the appropriate monetary policy stance, the governor council Tom will continue applying flexibility in reinvesting redemptions coming to you in the pep portfolio with a view to capturing risks to the monetary policy transmission mechanism. Related to the pandemic, was that enough money she policy speaks in account. You know when you can do it, I could never do that. No, it's still. What I would suggest is anyone out there. No, no, it's not right now. Yeah, exactly. On Bloomberg radio, 47 people turn the radio off on I 80. What I would suggest is two things. One, how different these headlines are as a set from what we see at 2 p.m. for the United States Central Bank. But the other thing missing here is the Draghi confidence of a timeline out one year a time. I don't see 2020 confidence. The Draghi timeline headlines have disappeared. So we got the 75 from the ECB. I gave you the balance sheet unwind talk. Am I allowed to do the tau tro stuff or would you like me to avoid it? Should I avoid the tau tree stuff? I'm going to bring in the tau tro stuff, okay? The governing council decided to change the terms and conditions. It's a series of targeted long-term refinancing operations during the acute phase of the pandemic, this instrument played a key role in countering downside risks the price stability today in view of the unexpected and extraordinary writing inflation. It needs to be recalibrated to ensure that it is consistent with the important monetary policy normalization process and to reinforce the transmission of policy rates increases to bank lending conditions leads to the final word here. The governor castle therefore decided to adjust the interest rates applicable to tau tro three from the 23rd and November 22. To offer banks additional voluntary early repayment. Okay. So hold on a second. This, it's like English words that are not English, put together. None of it is. But okay, so that's what that's a Central Bank speak, maybe, is to translate how much are some of these cheap loans. I was actually just reading up on this because I didn't really understand it. How much of these cheap loans is sort of a problem for an ECB that wants to tighten
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"We do think that Europe is certainly cheaper, particularly the investment grade market in terms of credit spreads. So what that means is that, you know, the concerns in the marketplace around slowing growth, European recession, and obviously gas shutoff are somewhat in markets. We are cautious on Europe as well, but I do think that from a buying opportunity standpoint, we will be and we said we'll be looking to buy European credit risk into additional weakness, particularly at yearend. And so that's partly driven by the valuation story, but it's also driven by the view that we ultimately think the ECB is going to be faster to add liquidity support back to the market. They will need to to some extent quell or try and address issues of debt sustainability and concerns around the periphery. And I think that they will react quicker than the fed will in the context of some of the earlier comments that you had on the show around the fed, whether or not the fed will hike and then subsequently cut and obviously quantitative tightening. So the bottom line is we'd be looking to buy opportunistically European credit into weakness. We're not there yet. Mainly on valuation, but also on the ECB reaction function being more dovish. Again, not now, but as we get closer to the end of the year. That was Matthew mish, head of credit strategy at UBS securities, with Bloomberg's Anna Edwards and Alex Steele. And coming up is now really a good time to be a value investor. You're listening to Bloomberg best. Progressive presents, married to your home. I'm such a screw up. What? How? Why would you talk like that? How are you even with a house without a walk in closet? Stop, you have more than enough storage. Oh, yeah. And the unfinished basement. Gross. We'll finish it
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Influential conversations from Bloomberg television. Here's Tom McKenzie. Derek halpin in our head of research global markets are mere and international security at MUFG with what you heard from J pal, hire for longer. Does that underpin the dollar in the quarters ahead? I think it does. The markets are starting to kind of go back into risk off equity markets are a bit more fragile. So there's clearly indications there that the markets are beginning to listen to the fed. But really energy comes into play. And the question is, will the ECB and the Bank of England be able to implement what's priced into the market given what's happening in the energy markets? And we want to unpack the energy stories with you for now. Just focusing on that decision for the fed in the September. What would 75 basis points do for dollar? Not a whole lot when in the background you've got the potential for the ECB to do the same. So when that story came out last week, I was a little bit skeptical to be honest, but now we've had some comments from other ECB officials to suggest it's at least on the table. And in these markets, in this world, who knows, they could very easily do 75 basis points. I can't believe I'm saying that. But that's where we are. And in those circumstances, 75 from the fed, when we're about 67, 68 basis points priced, I'm not sure that's going to change the dial significantly from a dollar perspective. Here, more conversations like this one on Bloomberg television, streaming live on Bloomberg dot com and on the Bloomberg mobile app or check your local cable listings. Markets, headlines, and breaking news, 24 hours a day. At Bloomberg dot com, the Bloomberg business app and at Bloomberg quick tape. This is a Bloomberg business flash. But I'm Karen Moscow and U.S. stock index futures have been fluctuating a bit this morning stocks. Meanwhile, are headed for a monthly drop on concerns that restricted monetary policy to tackle inflation will harm the global economy. We check the markets every 15 minutes throughout the trading day, on Bloomberg, S&P futures, their little change now features now down about 51 and NASDAQ futures are up 19. The Dax in Germany is down 8 tenths of a percent ten year treasury down 6 30 seconds, 3.12%, yield on the two year 3.47%, 9 X crude oil edged down two and a half percent on $2 25 cents at $89 40 cents a barrel. Comic skull down 6 tens percent or $11 is 1725 40 ounce. The Euro .9991 against the dollar British man 1.1641 in the yen one 38.66 and Bitcoin this morning at 1.2% at $20,220. As a Bloomberg business flash, now here's Michael Barr with more on what's going on around the world, Michael good morning. Good morning, Karen, the Department of Justice says White House records held in the storage room at Donald Trump's
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Dot EDU. Influential conversations from Bloomberg television. Here's Tom McKenzie. All right, let's get into some of these other key market drivers then with Alex brazier deputy head. At BlackRock investments institute. Bacillus mentioned the prospects of a debt crisis, maybe different to the one that we saw around 2009, of course, Greece, focal to that. Is a debt crisis can they avoid a debt crisis as the Frank menation tool of which we have some details now, not all the details are going to be enough that you think to avoid that scenario. I think it will be enough. Now, question is, how long does it take to be enough? There may be some volatility along the way. But I would go back to the fact that as we outlined in our report, we think the ECB will pivot at some point away from its determination to raise rates this year towards ultimately living with a bit more inflation and there are two reasons for that. One is, as you say, the fragmentation risk of slamming down demand through raising rates, even if they have a new tool, they will be limited in their ability to raise rates as far as they think they need to. And secondly, the ECB like other central banks faces this brutal tradeoff between bringing inflation right back down to target and stabilizing growth. Once the costs of rate rises, particularly in the environment of the energy shock become clear, we expect the ECB to pause. And as a result, you see that reflected now in the currency. But we expect interest rates at the short end to be somewhat lower than the markets currently. Here more conversations like this one on Bloomberg television, streaming live on Bloomberg dot com and on the Bloomberg mobile app or check your local cable listings.
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"The Russian gas and ECB kind of ambiguous on what they're going to be doing. All of this is kind of a risk off. So I think the dollar is supportive as long as that's the news flow. But I think if there's any signal that there's some merit to optimism, I think we will see the dollar come off. I think the market is very long close right now. Steve Wendell, F stand shot, greater catch up, taking things back 20 years to the early 2000s. Tom. Early 2000s, you remember that lineup a city in the early 2000s, Steve englander bob Singh, Steve say well, what a lineup of foreign exchange that was 20 years ago. Let's stop here, folks. And this is really important and that John and I really, really look at the pedigree of the different shops, and people bounce around and move around as well. But they each have a certain character. Each one of these firms is different. We're trying each day to give you a cross section around them. John, I would look at focus land on Deutsche Bank now is absolutely fascinating. The contributions they've made recently. I got back to that team 20 years ago, city Tom, because I think it produced about 5 heads of foreign exchange. And Wall Street. 20 years later, over the next ten, 15 years. You know, you follow the pedigrees. I think bob cinch is running a hockey camp now. I'm not sure of that, but it's north of old forge. Maybe Lisa concealer when she poor Taj's. When breme flies off this weekend. I'm not flying. I'm driving. I'm worried about getting canceled. You know, the brain. Seriously. People on the break here, they're like, what are they doing on the break? Well, yeah, I mixed some more Tang. That's true. Lisa's completely focused on deer fly repellent. The 3M ultra insect repellent looks to be the one Lisa. Is that serious stuff, Tom? Yeah, it is. It's got like grandma. If you're just chilling in, believe it or not, stuff's happening. I was about to say half of 1% on the S&P and some interesting stuff in a bond market too. Two tens inverted. Where are we now, Lisa ten, 11 basis points negative 11, yeah, and it's the most going back to 2007, which I think is notable. We crossed the 11 basis points. We are now firmly through that. Negative 11 basis. Rounded up, negative 12. Yeah, looking at 12. Stunning. Run it down into CPI tomorrow where we look for something close to. 9%. Interest in the direction of travel here, Lisa, govern into that CPI print tomorrow, recess sounds later this week too. You mentioned, I never thought we'd sit here and be talking about consumer inflation expectations of the University of Michigan consumer sentiment report. But here we are because of chairman Powell I guess. There is a consensus right now that is building that longer term, we will revert back to a normal. The issue is how we get there. And now that seems to be the question that people are passing through, but the consensus, at least for the moment, is for that longer duration bid. Futures down a half of 1% on the S&P from New York City this morning with Tom Keene, and Lisa Abramovich and Jonathan farrow for our audience worldwide heard on radio scene on TV. This is Bloomberg surveillance.
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Protect the vital systems we rely on because if we don't, the alternative is unimaginable. Periton. How the ECB wants to make sure that it can actually tighten or normalize the ECB doesn't talk about changing policy. They want to normalize policy, which means they are committed to getting back to a neutral level and not necessarily into restrictive territory. But the question is, how are they going to achieve it? We've seen in bond markets that people are concerned about individual countries, the concern on Italian debt is very much back and that's certainly an extra concern the ECB is working on a anti fragmentation tool. So a tool that will ensure that monetary policy reaches each and every corner of the region, we know very little about what it will look like. President Lake art said it will be ready for consideration at the ECB's meeting at later on in July. But it will involve selective bond purchases. There's some. Rules going to be attached. They will have to make sure it's not neutral on the balance sheet. So they're working on that at the moment and they are starting on Friday. To make more flexible reinvestments under their old pandemic program, just to make sure that we're not seeing spreads blowing out in the periphery and specifically in delay. Yeah, absolutely. That's something we'll continue to watch. Gianna, thank you so much for being with us. Bloomberg's ECB reporter Yana Randall just sort of giving us the view on all of those central bankers gathering in sintra in Portugal. This is Bloomberg
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"The sours top business stories. ECB president Christine Lagarde restated officials intention to hike interest rates in July and September. The comments follow it emergency meeting last week where officials accelerated work on a tall to defend the integrity of the Euro region. Lagarde said the decision to develop this crisis measure is necessary to keep inflation under control. This is certainly the most dramatic action they've taken both the fact of a 75 basis point move. And what was clearly a calling of it audible just before the play at. We're going to adjust a little bit of a technical situation here that was Larry summers. Let's get to Christine Lagarde. Anti fragmentation is a precondition to the proper transmission of monetary policy. And to those who are concerned that possibly, this would be outside the mandate. It is right at the core of the mandate. So this new crisis fighting tool likely to feature purchases of debt from more highly indebted nations than the guard said the work is underway and declined to reveal details on how it's all supposed to function. The measure is meant to be finalized before the ECB governing council's next scheduled policy meeting in July. More economists and industry experts are beginning to say that U.S. home prices will drop as mortgage rates rise. We have more from Bloomberg's Denise Pellegrini. Matthew pointin senior property economist at capital economics says prices could drop 5% between now and this time next year. And point in telling clients rising mortgage rates will limit the pool of buyers and thus force home sellers to lower those asking prices. Bloomberg intelligence says regions with a lot of new homes coming online are among those areas where prices could slip. And at the same time, we could also see demand for some lower priced home stay strong and prices could also remain somewhat elevated in areas where inventory is tight. Denise Pellegrini Bloomberg Debra kaisha. One in four European companies in China are considering shifting their investments out of the country. Those filings are from a survey by the European Union Chamber of Commerce and China, not surprisingly, China's COVID zero strategy was a major factor, the survey was conducted at the end of April when Shanghai was still in shutdown, and when COVID restrictions were in place in the province of jilin. The firms considering a shift in investment in 19% said they were looking elsewhere in Europe, 16% said they were looking at relocating to Southeast Asia, 18% said they were looking elsewhere, and the apec region. 33 passed the hours we crossed two Hong Kong Brian Curtis there, looking at markets. So it's going to be very interesting, I think, to see what happens in the bond market when trading begins at the top of the hour in Tokyo. Yeah, judging by what we're seeing in equities, it probably won't be too volatile, maybe expecting just a little bit of selling in bonds and perhaps the yields will edge a little higher. It doesn't seem that investors are too nervous this morning. We had cash equities in Europe do well and right now the futures are up between about a quarter and three quarters of 1% for essentially all of the markets. It's a sea of green that's looking out at me from my launch pad here on the Bloomberg terminal. We've got the dollar a little weaker so that helps win last traded ten year treasury yield 3.22%, WTI has rebound a little one ten 50 for a barrel and Bitcoin is up now to 20,580. So looking pretty solid here in the Asia Pacific. Paul to you. All right, thanks very much, Brian, 34 minutes past the R and our time for check
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Treasuries on the longer end of the curve If that fund goes higher than we think you can have some serious inversion I mean you can have inversion that I think people are really not talking about Whether it loses its signal at that point because of idiosyncratic supply and demand forces in terms of telling us what that means for the economy I'm not convinced that that's going to be the case necessarily But keep your eye on that longer end of the curve I'm not sure it's going to follow the fed funds a time There was concern in the news conference about international economies And the stronger dollar That's the question that's the point I was about to make the really big fault lines the fit matters a lot but there are two other immense fault lines in the global economy both of which are affected negatively by a strong dollar One is the Eurozone where very unfortunately the ECB still hasn't managed to convince markets for much the same structural problems that created the crisis of a decade ago that it's going to be able to keep the Eurozone together asset raises rates and more pressure on the Euro makes that all the worse And then in Japan you've had the yin breaking through some very significant one 35 Yes And also 20 to the Chinese yuan which is only the second time it's got there The first time was followed within days by the shocking Chinese yuan's evaluation of 2015 that then caused a sort of mini global crisis for a few months So there is also a very important element of tension where if the Japanese want to keep controlling the yield curve that will mean the United States ever more artificially weak And that is going to be a real problem for its neighbor China So that's the other fault line that it's very difficult to avoid John authors a near case are there Stay.
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Around the world it has to make it first freely convertible or at least more freely convertible and that just has not happened And it's probably a likely to happen just because Beijing doesn't want to give up the control it has by keeping that capital count closed Well thanks to our China executive editor John Liu Yeah really fascinating isn't it to hear the picture is so very different when it comes to COVID COVID zero policies in China versus Europe Well coming up next on the program So Lizzie and I are going to be welcoming seniors as CIO at saxo bank He's got the quarterly report out for saxo bank Always very interesting His team often look quite big picture So we'll be talking about the two huge events that have worked markets So the pandemic and of course the war in Russia and how this is changing Europe We've also had some commentary out of the ECB more speakers Are we reaching peak inflation or not big question Lizzie Yeah my economy team colleagues Janna rando and Alessandra migula knocking it out of the park Too ECB scoops in the past 12 hours They've got a big interview with vice president of the ECB Luis de green dose talking about where he sees inflation going He says the inflation rate is close to peak And money markets now pricing three ECB quarter point rate hikes in 2022 And again I think we should be asking seniors and whether he thinks that that is possible or not yes we may have 7 and a half percent inflation in Europe and rising but the issue is around the war in Russia and Europe's dependence on Russian energy There are shocks aplenty can the ECB really pull off that kind of policy move And it's not just the ECB who's hastening its eagerness to end ultra loose policy We're also seeing the fed ramping up the hawkishness now calls even for a 75.
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"Own is not a monetary solely problem and they don't have the correct tools or whatever to do and affect things all that they would like to be able to get inflation back down But clearly the threat of recession is much more prevalent in Europe and is elsewhere really So they have to do something but have a confidence that what they're doing is keeping financial conditions easy which is always the preeminent concern that the guard wanted Yana do you think that again as all of these pressures build in Europe we get once more that the concern that the ECB has to make policy for all of these different countries that are being affected in different ways by cost pressures by wages rising by energy prices rising And yet you know all those countries have to be brought on and a lot will be worried as Marcus says what will be worried about a recession hitting their country Yeah I mean the good thing if you can call it a good thing is that the problems are very similar across the Eurozone Inflation is high everywhere It's just a question of how high and in fact the economy is still doing reasonably well in those cases that have traditionally weaker growth I'm thinking of Italy here A lot of support is flowing from fiscal policy from EU recovery funds So in terms of economic fundamentals there is not a whole lot of divergence there So from that perspective fragmentation is not an issue but where there is concern on the ECB of course is what happens when you end asset purchases That's on the agenda for the third quarter unless the situation deteriorates and things change Jana Marcus thank you so much for giving me your time at talking us through what to expect from the ECB decision next week That was Bloomberg's Yana Randall in Frankfurt and our Bloomberg opinion columnist Marcus ashworth I'm Caroline Hepburn here in London You can catch us every weekday morning for Bloomberg daybreak Europe beginning at 6 a.m. in London That's 1 a.m. on Wall Street John Thanks Caroline Just to hit on Bloomberg.
Bloomberg Radio New York
"ecb" Discussed on Bloomberg Radio New York
"The latest comments from ECB president Christine Lagarde and counting down to Thursdays on important U.S. CPI reading Let's head out to Danny Murray EFG private bank deputy CIO and global head of research Dan why did you make that of the announcements that came through from miss Lagarde in the last training day The last 24 hours Yeah I think it's really interesting the way that monetary policy is shifting at the moment Clearly we've seen a really good exercise in house communicate from the third they've gently guided markets towards expectation the rate increases this year and have adjusted inflation data has changed We've seen the Bank of England do the opposite and completely surprise markets with their actions and support their reputation as being an unreliable boyfriend And I think the ECB is sort of children and middle path where they're trying to guide markets carefully and gently according to the data as it comes in but without doing anything to extreme So I think it's a fine line that they're treading so far obviously we've seen markets overreact but we have of course seen a bit of a blowout in the peripheral spreads and in the spread of some of the countries that the ECB has been buying So I think it's very interesting environment in the moment Well one could say is that that faux pas in terms of not decrying a rate height last week is bad communication of blowout and Greeks that blow out in all of the spreads is not exactly guiding us in an even way The question is this is whether inflation is topping 8 or will continue higher And I want to show you on our view as a chart This is inflation swaps which are actually diverging to the estimates by over 1% So the swaps market the forwards market is saying inflation is rolling over on one year 5 year three relative to the estimates The central banks are going to have to dine gray their view on inflation If these swaps are correct do you think we've topped out Do you think the swaps market is right We've reached the top of the inflation narrative So I think clearly central banks have been taken by surprise by the strength and persistence of inflation as have indeed many private sector economists and analysts I think what's really interesting is that the size of the base effect this year is really huge So according to our estimate in the U.S. the base effect will take around about 7 percentage points off of inflation this year But those effects don't really start to kick in until March and that march there won't be released until April So probably still got another couple of months of uncertainty before that data starts to roll over markets always of course overshoot And so it's natural that inflation is going up and it's central banks have adjusted so markets have probably overshot it to the upside and then I think the pricing we're seeing talk to markets I think is really based on those very large base effects that are going to come through later this year I want to get to the treasury sell off that is still underway We've reached 1.95% That is the highest level since the end of 2019 Bloomberg understands that at that kind of level you have the mortgage bond funds that are going to be forced to sell to kind of protect some of the portfolio exposure to further losses What's the trajectory from this point onwards for ten year yields over the next 5 training sessions or so would you say Yeah I mean the short term is always very hard to call but I think the way that we're thinking about it is that the long end always prices in these rape moves for and then it's a shorter that catches up So we expect gentle move higher in the long end somewhere a little bit north of 2% and in the short term we'll eventually come up and we'll see a bit of flattening I think you do of course as you highlighted you get these overshoots impacts where there are certain momentum traders that are either full set of the force bars depending on the direction of the market Of course you get momentum trading that's exaggerated by hedge funds and CTAs and actors can lead to a bit of an overshoot So you may see yields go a little bit higher but as I said don't expect too much further of the sell off in the long end as the markets quickly adjusted to more rate outs from the fed Your view on growth is that global growth will be above trend You're looking for four and a half percent I'm just curious how you position for that Jeff curry says every molecule is scarce in the world a Goldman Sachs the commodity markets are on fire How do you take exposure to that view of growth So I think the context is one where we had this huge amount of emergency stimulus in 2020 both on the monetary side and also the government side But until his natural sort of rebound in private sector activity anyway And so 2021 was a really exceptional year for growth And I think we're not of course going to see that So we're faced with this sort of interesting situation at the moment where growth is still strong but it's slowing down So four and a half percent growth in the world's advanced economy is still of course very rapid by historic standards but it's a slowdown relative to last year I think that creates an interesting dynamic for markets and as they reprise So we still got the tail impact of a large degree of stimulus We know that stimulus is starting to tail off and maybe even going to reverse later this year But at the same time we still got very strong growth So interesting environment I think things to look out for and grow for clearly the extent to which we do indeed see the COVID impact tail off or as we're saying the reaction from different countries around the world is quite varied We have a different impact whether you're in China or Hong Kong or if you're in the parts of Europe it's much less And that clearly has an impact But overall we do expect to wane and we think that the return of the consumer is going to be a really powerful force for the global economy for this year and next as individuals start to get out Get back out there and start to spend some of the savings that they've built up over the past couple of years Daniel thank you very much Daniel and Mary there from each of your private bank deputy CIO and global head of research plenty more ahead On.
Odd Lots
How Exiting the Pandemic Is Affecting Central Banks
"Joe. I feel like it's an interesting time to be central bank. I mean yeah it always is. But i think particularly interesting right now because the the scope of new challenges new economic conditions new forces on sort of like how banking and money and markets work. Lots of new stuff right now. Lots of a new territory. Yes so not. Only are central banks responding to an exceptionally unusual economic crisis in the form of a global pandemic which basically led to the shutdown of the entire economy last year. But they're not now Reacting sort of differently to the recovery. So for instance. We saw the fed coming in more hawkish than expected last week. But it's still on hold for the foreseeable future. You have brazil delivering successive rate hikes to deal with inflation. China's sort of winding down. Some of its easy monetary policies. The ecb hasn't even started tapering or even talking about tapering at this moment. In time so you have all these central banks sort of off and doing their own thing trying to respond to this very new environment. And in the meantime you also have some very interesting ideas floating around on the nature of money so sort of like the very fundamentals of being a central
Wall Street Breakfast
ECB to Speed Up Bond Purchases
"Eyes are on the european central bank this morning as worries over rising bond yields remain a concern for investors no changes to rates or the amount of bond purchases are anticipated. Though policymakers will decide whether rising borrowing costs or a threat to the panic stricken economy. While the ec- be has current quota to purchase one hundred trillion euros through next march purchase volumes have decreased over the past two
WSJ Minute Briefing
ECB hints at more stimulus in December as new coronavirus lockdowns are imposed
"A second wave of coronavirus infection sweeps across Europe, the European Central Bank said a strong signal that it could increase its monetary stimulus in December to try to cushion the economic shock from a new series of lockdowns. Analysts fear lockdowns in France and Germany could push the region's two biggest economies into contraction and the fourth quarter.
Wall Street Breakfast
ECB addresses stronger euro, says it will ‘carefully monitor’ exchange rate
"Currency traders are preparing for a key meeting at the which has seen the euro appreciate heavily over the past few months especially after the Fed signaled a willingness to allow inflation to overshoot its target. The dovish stance which gives more weight to the labor market and less weight to inflation has added to the downward pressure on the US dollar and the E CB's Christine Lagarde is expected to talk down the euro as much as she can normally a central bank would cut interest rates to deal with this kind of situation but rates are already deeply negative across the eurozone instead the May stress that the one point thirty, five, trillion, euro envelope of the P P P pandemic emergency purchase program is not a ceiling and that it is prepared to increase its pace and size.
Odd Lots
The ECBs Former Vice-President Explains The Historic Step That Europe Just Took
"True CEOS thinking we don't really talk that much about Europe these days. I mean, I guess not in relation to the the heady days of the eurozone debt crisis. Now we don't, but also I feel like this particular crisis at least some of our episodes, you know, obviously, we talk a lot in the bed context the US context, of course, know talked about Hong Kong and Asia and Asia supply chains in China and so forth stills like we've focused a little bit less on how this current crisis is playing out in the Europe. Yeah I think that's right I. Guess the implication is that maybe this has been unfair in some respects because there has actually been something very interesting going on in Europe at the moment. Yeah. I mean, for one thing you know there's a good argument to be made Europe at least relative to the US, if not necessarily Asian countries has done a pretty decent job overall of suppressing the virus self and you know for years during the euro area crisis, they're always people fiscal policy. Fiscal Policy Missing. You gotta spend more gotTa get the Germans to spend more and you know maybe this time it looks like they're actually doing. Yeah that's exactly what I was thinking. So we have the announcement of a big deal seven, hundred, fifty, billion euros worth by the EU to fund on long term recovery. Fund for the Eurozone and that's a big deal because as you point out, everyone's been talking about fiscal stimulus but it looks like the euro-zone is finally going ahead and doing it. Right and so this of course raises questions and it's a theme that we've definitely had a lot on on our podcast, which is, is this offer something bigger for the post-crisis period? So sports, it's well known that know there's a lot of money being spent by governments all around the world including the US. But the question mark is okay when the crisis phase is over the government's just retrench or does this become a sort of new macroeconomic stabilization model? That's a theme that we've had dozens of times but it's particularly important to New York, in context I think because people have sort of identified the lack of fiscal burden sharing his sort of a basic architectural tension or flaw within. Euros. Yeah I think that's exactly right. How does the I don't want to say the intrusion of fiscal stimulus but how does the arrival of fiscal stimulus on the scene actually reshape the way that monetary policy works and I? Guess we should also mention that the is also in the midst of a of another really important project which is rethinking. How it targets inflation. So we have all of this going on simultaneously real existential questions for the role of the European Central Bank. Absolutely well, I'm very excited. We have a fantastic guest to talk about all of this we are going to be talking with Vito comes don. So he is the former vice president of the European Central Bank from two thousand, Ten may twenty eighteen. He's now a professor at Navarra University in Madrid out the perfect guest to discuss all this. So without further ado, let's bring him in a veto. Thank you very much for joining us. So are you happy to not being a policymaker in this time or you? Do Miss being at the ECB during such an extraordinary moment. Well, it's always difficult to get out of you know executive responsibilities and I. Of course, I would not say that I, am Epi at the out or unfortunate circumstances of the covy. The shock we are again in a very important periods of policy making but. Me Europe as been doing well I think in these episodes. Better than in the previous episode of two, thousand. Ten to two thousand twelve. Just to start out with walking the significance of the deal that was agreed, this seven, hundred, hundred, billion euros you tweeted about it clearly, you think it's important. What's the significance. Well it establishes for president that are very meaningful. In, the first place it involves a decision to issue common European depth. The Commission will issue seven hundred and fifty billion of debt to fund these program, and that's the first. The second the point is that these is going to be distributed in the form of budget transfers and not loans to the country's. Third IT'S A big program to implement Wat- is a European fiscal policy stimulus to address a recessionary phase. India to be an economy, and that's also the first time that these happens at this level and fourth the distribution of the ballot transfers which. Correspond to a little more than half of the seven hundred and fifty billion is done in a way that it is not proportional to the size of each country. By two indeed benefits more the countries that's have lower level of leaving and higher unemployment. So there is a convergence play. There is solidarity aspect of these edits also quite new in terms of transfers to give you two examples on a proportional basis, Italy would be entitled to fifty billion, but the they are getting eighty billion. Right as Germany, you'll be entitled to ninety six billion in proportional terms, but is getting only twenty seven. So these four points put together constitute the indeed very important precedents and babs, and do we all hope so that it will be a sign of things to happen. If again, there will be a stressful situation in the European economy, and that's a very important element for everyone the notion that when there is a very stressful social economic situation Europe, steps up and two x decisions to fight the recession and does not leave behind any of the member countries. It's a big message for the future and I think markets are really beginning to injury injuries what these means And we see that already but it will take time of course, perhaps for the markets by Geico anglo-saxon markets to overcome. Lingering, doubts about the European project.