With the ECB patching up the eurozone crisis by funding cheap three year loans to European banks buying sovereign debt and Bernanke’s last exercise in jawboning causing only a one day blip in markets, 2012 may be the year when central bank announcements give way to the political timetable as the main driver of sentiment. Some highlights ahead.
A general election in Greece (April-May), a presidential election in France (22 April and 6 May 2012) and the Irish referendum on the EU fiscal compact (31st May). Will agreements on the Greek bailout and the European fiscal treaty suffer reversals, if so what are the implications for bond markets in Portugal and Spain?
Syria – amid Israeli talk of the ‘window’ of opportunity closing on Iran nukes will there be a ‘humanitarian’ intervention in Syria, would Iran respond to by sponsoring unrest in Bahrain and shia parts of Saudi Arabia, would Russia and China respond to a non-UN authorised intervention in Syria with economic measures-–i.e more non-dollar denominated trade?
US election- Will it be two ‘big Government’ candidates Romney V Obama, if so Romney’s tilt towards the military and Obama’s towards welfare will ensure any restraint on government spending will be moderate post election, which means increasing inflation expectations and a softening dollar during and after the election campaign.
China leadership handover 2012-13 –the attitude of the new leadership will likely determine whether China hard lands this year – more stimulus for stability possible, but not directed at Western export demand.
A general election in Greece (April-May), a presidential election in France (22 April and 6 May 2012) and the Irish referendum on the EU fiscal compact (31st May). Will agreements on the Greek bailout and the European fiscal treaty suffer reversals, if so what are the implications for bond markets in Portugal and Spain?
Syria – amid Israeli talk of the ‘window’ of opportunity closing on Iran nukes will there be a ‘humanitarian’ intervention in Syria, would Iran respond to by sponsoring unrest in Bahrain and shia parts of Saudi Arabia, would Russia and China respond to a non-UN authorised intervention in Syria with economic measures-–i.e more non-dollar denominated trade?
US election- Will it be two ‘big Government’ candidates Romney V Obama, if so Romney’s tilt towards the military and Obama’s towards welfare will ensure any restraint on government spending will be moderate post election, which means increasing inflation expectations and a softening dollar during and after the election campaign.
China leadership handover 2012-13 –the attitude of the new leadership will likely determine whether China hard lands this year – more stimulus for stability possible, but not directed at Western export demand.
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