With general elections scheduled in France, Germany and the Netherlands this year amid an increase in support for anti-euro rhetoric, European bonds from Germany to Greece saw yields surge in January. In fact, as Bloomberg notes, euro-region bonds handed investors the worst start to a year on record.
Worst. January. Ever. for European bonds...
In a shot across the trade war bow with both Japan and Germany, on Tuesday Trump and members of his administration took aim at both Japan and Germany, in addition to China, to accuse them of devaluing their respective currencies, an unexpected move which sent the dollar sliding to multi-month lows. Specifically, on Tuesday morning Trump said: "You look at what China’s doing, you look at what Japan has done over the years.
European stocks rise the first day in four, with Asian stocks, S&P futures and the Dollar all gaining following strong Apple earnings ahead of today's Fed decision and the U.K. parliament's first vote on the Article 50 bill.
After a turbulent week for the French Presidential front-runners, the latest polls show far-right and anti-EU candidate Marine Le Pen gaining traction.
Le Pen has the younger vote...
And as Bloomberg points out, markets are starting to take notice.
The last 4 months have seen something 'odd' happen in Europe's periphery. Sovereign 'risk' has conspicuously (and rationally) risen as macro-fundamentals have deteriorated - something that we have not seen since Draghi's 2012 "whatever it takes" moment.
For the first time since June 2015, Italian youth unemployment has risen above 40% and notably, Italian bond yields are rising...