Hledat v komentářích
Investiční doporučení
Výsledky společností - ČR
Výsledky společností - Svět
IPO, M&A
Týdenní přehledy
 

Detail - články
Weekly CZK Report: Verbal intervention from ECB

Weekly CZK Report: Verbal intervention from ECB

30.7.2012 12:32
Autor: Tomáš Vlk, Patria Finance

The koruna has firmed to both the euro and the dollar. The currency was mostly influenced by the situation on the global markets as no local events were scheduled. All the CE currencies profited significantly from the growing expectations the ECB will announce new measures to tackle the debt crisis. 

The markets started the week in a negative mood amid worries that Spain and Italy may soon need an external financial aid and that Greece is heading for a default. The Spanish yields spiked after financial strain in the regions and a forecast of longer recession suggested a bigger pressure on the country´s public finances. The Italian yields increased significantly, too, driven by similar problems in the regions and concerns that the Eurozone will not be able to contain the spreading crisis. Moreover, Greece still fails to meet the bailout conditions, which supports bets on another default.

Macro data from the Eurozone fell short of expectations and also weighed on the market sentiment. The manufacturing PMIs in the Eurozone and its two biggest members dived even deeper below the 50 mark, while they were predicted to improve slightly. The German Ifo business climate index has also worsened. Furthermore, Moody´s has worsened its rating outlook for Germany, the Netherlands and Luxembourg and the UK posted a significantly worse GDP figures. On the other hand, the US data was not bad; the 2Q GDP came out slightly above estimates.

The surge in the Spanish yields raised a real threat that the country will soon need a financial aid. However, the country cannot rely on the ESM that will have a delay due to a longer approval procedure in Germany. Moreover, the Italian yields also reached levels that the country can hardly bear for a longer period of time. This is even a bigger problem than Spain, because the Eurozone rescue funds are insufficient to support such a big debtor. Both countries have several bond auctions scheduled for next week. That is why the surge in bond yields was alarming and motivated the ECB to step in.  

Two important ECB comments came in. The council member Ewald Nowotny said that there were arguments in favor of giving the ESM a banking license. This would greatly increase the fund´s firepower, connecting it to liquidity from the ECB. Although there is still a strong opposition to such an idea in the central bank and there are also legal obstacles, the comment had positive impact on the financial markets, suggesting that the ECB will not stay inactive.

The second comment had even much bigger effect and gave markets significant boost. ECB´s President Mario Draghi said that the bank will do whatever is needed to preserve the euro and assured that “it will be enough”. Draghi pointed to sovereign risk premia that hamper the functioning of the transmission mechanisms, which indicates that the ECB might resume buying the sovereign bonds. However, due to a strong opposition to massive bond purchases, the central bank might opt for only some temporary interventions in order to reduce the bond yields until the ESM starts working. That would likely be disappointing for the markets as expectations that a big action is coming are already very high.

Next week, a big focus will also be on the US macro data and the Fed decision. The most important releases of the month, the labor market report and the ISM indices, are on the agenda. Recently, the Fed has not further encouraged bets on another QE. However, the expectations that another stimulus will come are still quite strong and the FOMC meeting will, therefore, be an important market mover of the week.

In the Czech Republic, the PMI should show how significant is the negative impact of the weakening Eurozone on the local economy. The retail sales should confirm the continuing weakness of the domestic demand. The CNB will decide on rates and is expected to keep them unchanged. Another cut would be justifiable, but the bank is not under pressure to do it. Moreover, Governor Singer, who voted for the cut last time, will miss the monetary meeting. The event may be neutral to slightly negative for the koruna, depending on how dovish the statement will be.

Váš názor
Na tomto místě můžete zahájit diskusi. Zatím nebyl zadán žádný názor. Do diskuse mohou přispívat pouze přihlášení uživatelé (Přihlásit). Pokud nemáte účet, na který byste se mohli přihlásit, registrujte se zde.
Aktuální komentáře
24.11.2017
19:12Vysvětlí se někdy akciově – dluhopisová záhada posledních let?
19:01Černý pátek na Wall Street končí v zeleném
17:06Praha vymazala týdenní ztráty, táhla ji Erste
17:01Eurodolar je po růstovém týdnu na dosah kulatých 1,20  
16:25Perly týdne: Investorům došly peníze a medvědí akcie letos krutě trestají
15:00Týden technicky: Koruna prorazila další důležité supportní pásmo
14:21Německo se možná vyhne předčasným volbám. Ve hře je velká koalice
13:44Češi peníze mají. Podle obchodníků jsou tržby na Černý pátek rekordní
13:24Zpomalení globální ekonomiky přijde v roce 2019. Kdy zareagují trhy?
12:11Bude internet pay-to-play? V USA začala bitva o jeho budoucnost
11:17Evropa na konci týdne mírně roste, daří se bankám
10:42Dolar dál ustupuje, zatímco euru znovu pomohla solidní makrodata  
10:38Nálada v Německu dál láme rekordy. Tak proč euro nesílí?
10:37Důvěra v ekonomiku ČR v listopadu po čtyřměsíčním růstu klesla
10:22ERÚ: České domácnosti si příští rok připlatí za elektřinu i plyn
10:16OPEC v centru dění - prodlouží dohodu na omezení produkce?  
9:24Česká exportní banka, a.s.: Informace o vyplacení úrokových výnosů z emisí dluhopisů
9:23Rozbřesk: Nálada v eurozóně láme rekordy, ale euro nemá sílu dobrá čísla ocenit
8:50Evropské futures v zeleném, pomůžou Praze zvrátit čtyřdenní pokles?  
8:47Británie čelí nejdelšímu pádu životní úrovně za více než 60 let

Související komentáře
Nejčtenější zprávy dne
Nejčtenější zprávy týdne
Nejdiskutovanější zprávy týdne
Denní kalendář hlavních událostí
ČasUdálost
1:30JP - PMI v průmyslu
10:00DE - Index podnikatelského klimatu Ifo