The Day Today

The (Burns Night) Day Today 25 Jan 2017

* Bundesbank Lautenschlaeger: “All preconditions for a stable rise in inflation exist…I am thus optimistic that we can soon turn to the question of an exit”
* German SPD chief Gabriel makes way for Schulz to run against Merkel
* Can pro-EU Conservatives team up with Labour and SNP to force the Govt to produce a Brexit white paper to ensure the Govt wins the Article 50 trigger vote?
* ECB Chief Econ warns “tit-for-tat risk in world trade”
* Senator Schumer: “Mr. President: if you really want to put America first, label China a currency manipulator”
* Trump to Hasten Plan to Build Border Wall, Ban Entry to People From Risky Countries
* Trump did just use the expression “Send in the Feds” in a tweet as he warns Chicago to sort itself out
* Australia CPI subdued

The (Dad’s Birthday) Day Today 24 January 2017

* 90% probability that UK Govt lose Supreme Court ruling today on Article 50 trigger, according to Betfair
* UK opposition plans to force amendment so that the Govt must have a 2nd parliamentary vote on final terms of any Brexit deal
* UK PM plans China visit
* Merkel: “We won’t get anywhere by trying to solve problems with polarization and populism”
* France’s Hollande says EU to talk trade with Pacific Alliance
* Tsy Sec nominee Mnuchin: “The strength of the dollar has historically been tied to the strength of the U.S. economy and the faith that investors have in doing business in America…From time to time, an excessively strong dollar may have negative short-term implications on the economy”
* Trump terminates TPP, says he wants one-on-one trade deals that would allow the US to terminate in 30 days “if somebody misbehaves”
* Australia happy for Indonesia and China to join TPP instead
* Trump tells a room of business leaders: “We are going to be cutting taxes massively both for the middle class and for companies — and that’s massively”….” we can cut regulations by 75%, maybe more”
* Trump Press Sec: “The U.S. is going to make sure that we protect our interests” in South China Sea
* Fed Lacker: “Right now I think we are at risk of getting behind the curve, so lately I’ve been an advocate of pushing rates up a little more aggressively than my colleagues”
* Gundlach still likes TIPS and Gold
* China Says Prepared to Lead Global Economy if Necessary

The Day Today 23 January 2017

* Turkey parliament backs plan to strengthen powers of the Presidency, paves way for Spring Referendum that could allow Erdogan to remain in power until 2029

* Fed Williams: we need to “slam on the brakes”

* Trump: “We are going to start renegotiating on NAFTA, on immigration and on security at the border”
* Trump’s senior adviser Kellyanne Conway on the size of the inauguration crowds: “You’re saying it’s a falsehood and Sean Spicer, our press secretary, gave alternative facts to that”
* U.S. in ‘beginning stages’ of talks on Jerusalem embassy move

* UK/US trade deal could allow workers to move between US and UK as well as cutting tariffs
* UK PM faces pressure after reports of Trident nuclear test malfunction
* May to launch 10 point industrial plan
* Longest decline in UK business optimism since financial crisis

* German FinMin: “Britons should take as an example how cleverly Switzerland has linked national sovereignty and close cooperation with the European Union”
* ECB Draghi: “If a country were to leave the Eurosystem, its national central bank’s claims on or liabilities to the ECB would need to be settled in full”
* Far-right populist EU leaders meet, allowing Le Pen to claim “It is obviously very important to show that the cooperative Europe we want to achieve (is reflected) in our cooperation”
* France: Socialist rebel Hamon and ex-PM Valls head for runoff in presidential primary

* Majority of Japan firms plan no wage hike
Japanese companies believe that neither Trump nor Abe want to see the yen weaken significantly >120

* China regulators bar bankers from making net renminbi outflows as part of capital controls regime

* OIL: Saudi Energy Minister: “The Kingdom [of Saudi Arabia] has taken the initiative and other countries took part in very significant actions”…. Russia Energy Minister: “The deal is a success …All the countries are sticking to the deal”

The Day Today 18 Jan 2017

* HSBC: Trading operations that generate 20% of revenues may move from London to Paris
* New EU parliament leader puts the bloc’s three top jobs in the hands of the European party dominated by Merkel
Ireland says it has fielded over 100 inquiries from UK financial firms who want to understand regulatory regime if they moved
* May called Hollande yesterday and both want to start negotiations as soon as Article 50 triggered

* Russia ready to talk to Trump about nuclear arms

* Trump Commerce Secretary nominee Wilbur Ross: “I am pro-trade. But I am pro-sensible trade, not trade that is detrimental to the American worker and to the domestic manufacturing base”
* Republicans on Obamacare: 25% want to keep it and tweak it; 32% repeal immediately; 44% repeal when alternative plan ready to go
* Bayer and Monsanto chiefs met Trump team last week, pledge to create jobs in the US post-merger

* Fed Williams: “further gradual increases in the target fed funds rate will likely be appropriate”
* Fed Brainard warns over inflationary impact of fiscal stimulus, and “fiscal policy changes lead to a more rapid elimination of slack, policy adjustment would, all else being equal, likely be more rapid”

* Most Chinese Stocks Advance Amid Speculated State Intervention while President Xi is in Davos

* Percentage of US companies where China is in their Top 3 investment targets, falls to lowest since 2009

* Runaway Aussie Property Market Prompts Money Manager to Cut Debt to lowest since 2007

The Day Today 17 Jan 2017

* Theresa May to announce 12 point plan that will not the leave the UK “half-in, half-out” of the EU
* Carney: inflation will weigh on incomes which will weigh on expenditure, meaning “growth is expected to remain below past averages for the next few years”. [setting up the argument to raise rates or cut them!]
* PWC Survey: British bosses are more upbeat about business prospects this year than almost every other major advanced economy
* IMF raises UK growth forecast, 1.5% from 1.1%

* German FinMin rebuttal to Trump: “Whoever wants growth – and I trust this administration will be a growth-friendly one – must be in favor of open markets”

* Central Banks Drop Their Bazookas by Jon Hilsenrath

* Trump criticises Republican Border-adjustment tax – but only because it’s “too complicated” [he needs to be able to sell it!]

* President Xi is first China President to speak at Davos, he told Swiss execs yesterday “Protectionism, populism and de-globalization are on the rise. It’s not good for closer economic cooperation globally”

* RBA Harper would like to see the AUD weaker, notes that a US-China trade war would probably do that anyway

* Monetary Authority of Singapore chief warns over trade wars

* NZIER’s Quarterly Survey of Business Opinion shows businesses continue to expect good times ahead in New Zealand