Financial Balkanisation of the Eurozone

Convergence in core-periphery sovereign credit spreads since 2012 would seem to vindicate the raft of monetary easing measures deployed by the ECB to stabilise the eurozone. This is only half the story, and the other half is decidedly negative. The eurozone collapse...

EUR: Tactically Overbought; Macro Headwinds

Macro headwinds are building up for long EURUSD positions in addition to signs that EURUSD is becoming very overbought technically. A few weeks ago we noted that EURUSD sentiment was one of the most bullish (contrarian indicator) among the 50 major FX pairs we track....

European Recovery: Periphery Loan-growth Needed

One of the aims of loose monetary policy is to boost lending.  The theory is lower rates and greater availability of liquidity will encourage lending and borrowing, which in turn will boost economic activity.  Unfortunately, an increased supply of loans does not...

Eurozone Growth Stuck in a Quagmire

Eurozone growth goes from setback to setback with last week’s GDP number being just the latest in a long line of similar disappointments.  Soft indicators have consistently overstated the strength of this year’s recovery, and the unpleasant truth is that as one...
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