Recap 2015-02-19




  • Greece has submitted an extension request. Reuters saw the document and in it Greece pledged to honor all debts and not take unilateral action that would undermine agreed fiscal targets. The Eurogroup has a meeting scheduled for Friday to review the request. The German finance ministry has come out and rejected the proposal saying the offer doesn’t meet the euro regions’ conditions for continuing aid.
  • EU Consumer Confidence jumped to -6.7 vs -7.5 exp and -8.5 prev. This is the highest print since Sept 2007!

  • ECB Minutes highlights:
  • While the existing monetary policy measures adopted in June and September 2014 were showing encouraging results with regard to a further improvement in overall financing conditions, it had become increasingly evident that they would fall short in quantitative terms. This implied that the expected stimulus via funding cost relief and the boost to lending provided by the TLTROs and the existing private sector asset purchase programmes was more limited than had initially been envisaged.
  • A number of considerations in favour of maintaining a wait-and-see stance at the current meeting were also advanced by some members, as the cost-benefit assessment of the proposed measures was not positive in their view.
  • a large number of members were in favour of expanding the existing private sector asset purchase programmes to include purchases of a broad portfolio of securities of euro area governments and agencies and of supranational institutions
  • a pace of combined monthly asset purchases in the order of €50 billion lasting from March 2015 to end-2016, which had been mentioned by Mr Praet, was widely regarded as a sizeable complement to the existing purchase programmes… In order to accelerate the impact, there was broad support in favour of some frontloading by increasing the monthly purchase volume to €60 billion, starting in March 2015 and intended to last until the end of September 2016, while not materially altering the overall volume of intended purchases.
  • Due account would also need to be taken of the risks stemming from not acting at the present meeting, which might be higher than the risks stemming from acting. First, a large part of the very substantial financial price adjustment observed over recent weeks would most likely rapidly unwind if no monetary policy action were taken at the current meeting. This would effectively amount to an unwarranted tightening in the monetary policy stance.
  • France CPI declined to -0.4% YoY vs -0.3% exp and +0.1% prev
  • Philly Fed, declined to 5.2 vs 9.0 exp and 6.3 prev
  • Oil Inventories


  • Fri: Japan PMI, EU PMI, UK Retail Sales, Canada Retail Sales, MexicoGDP, US Markit PMI
  • Mon: German IFO, Chicago Fed National Activity Index, US Existing Home Sales
  • Tue: US Markit US Service PMI, Humphery-Hawkins, US Consumer Confidence, China HSBC Mfg PMI
  • Wed: France Consumer Confidence, US New home Sales, Oil Inventories, Draghi Testifies to EU Parliament
  • Thu: German GfK Consumer Confidence, EU Money Supply, UK GDP, Italy Consumer Confidence, US CPI, Durable Goods, Jobless Claims, Japan Employment, CPI