Weekly Digest: Stress Indicators // Italy sending warning signal? Copper bouncing, Europe's recovery already over?

Short and sweet this week, but a couple of pointers:

 

 

Contagion/Spill-over. Italian 2yr vs 10yr steeper – normally a sign of "noise" but an excellent way to monitor the Greek spill-over effect. This is merely early warning signal but warrants observing

 

 

 

 

 

Was this Europe's recovery? Remarkable weaker Citigroup Surprise Index for Europe – if lower energy, negative rates and weak EURO does not help the economy what will?

(or is reflection of Europe's export machine slowing down as US and China continues to disappoint?)

 

 

 

 

The impossible task of ECB – Draghi talks big and a lot, but the simple exercise of expanding the balance sheet of ECB is slow and probably impossible…. Can you spot the increase in ECB relative to other major central banks?

 

Furthermore note how Fed's balance sheet finally is dropping…

 

 

 

Dr. Copper-  The PhD in economics is showing some sign of life…. Is it the SILK ROAD and/or the lower energy? Again needs attention!

 

 

 

 

Attached the usual Stress Indicators…..

 

 

Overall:

 

Entering UK election and show-down on Greece – the chips can fall either way, but more uncertainty is almost given and hence higher volatility… No changes  to my portfolio at all since last month.

 

Safe travels,

 

Steen

 

 

Med venlig hilsen  |  Best regards
Steen Jakobsen  |  Chief Investment Officer

 

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