• Greek election still dominates the news – Coalition with right-wing Independent Greeks reassures the market – But SYRIZA has already prepared legislation to reverse some of the country’s structural reforms = EUR-negative • Main issues are govt budget and structural reform – Debt relief isn’t that big a problem, as maturities are quite long – Govt is currently running a big deficit; can they raise taxes enough? – They intend to reverse many structural reforms – ECB may pull the plug on Greek banks at end-Feb if they don’t reach an accord • CHF weakens as less need for safe haven after Greek election • RUB collapses on S&P downgrade to junk, talk of more sanctions • Today: – UK: 1st estimate of Q4 GDP expected to show acceleration in growth, but we fear the consensus could be disappointed – US: Durable goods orders for December expected to rebound; S&P/Case-Shiller house price index, Richmond Fed manufacturing index, Conference Board consumer index, preliminary Markit service-sector PMI • FOMC preview – FOMC likely to prioritize domestic economy over international economy, focus on labor market improvements. No significant change in text likely
Posted on: Tue, 27 Jan 2015 08:06:37 +0000
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