US Briefing - Wednesday 03.06
Headlines
  • Reports OPEC+ Jun 4 Meeting In Doubt Over Disputes On Oil-Quota Cheating
  • Trump Backs Off Push To Federalize Forces Against Riots
  • US NIH’s Fauci ‘Cautiously Optimistic’ About Covid-19 Vaccine
  • Biden Wins Democratic Presidential Primary In District Of Columbia
  • China Caixin Services May PMI Back In Growth At 55.0 Beats 47.3 Est
  • EZ May Final PMI Services, Composite Revised Higher Beating Estimates
  • BoE’s Bailey Tells UK Banks To Step Up Plans For A No-Deal Brexit Scenario
  • Merkel Forced To Delay Stimulus Package Amid Coalition Impasse
  • German To Lift Travel Ban From EU, Schengen Countries, UK From June 15
  • German May Unemployment Rate Hits 4 Year High At 6.3% (est 6.2%)
  • Europe Renews Push To Slash Global Tariffs On Medical Goods
  • EU Looks To Johnson To Stop No-Deal Brexit With Talks At Impasse
  • Italy Receives Over EUR100B Orders In Benchmark 10 Year Bond Offering
  • Amazon Plans Summer Sale For June 22 To ‘Jumpstart Sales’
  • Renault Rallies As Finalizes EUR5B Credit Facility With French State
Commentary
Incoming BoC Chief Macklem Likely To Stay The Course

Tiff Macklem’s first rate meeting at the helm of the Bank of Canada on Wednesday is expected to produce virtually the same policies set during the last meeting, according to economists.

 

The overwhelming market consensus is for the bank’s governing council to keep the overnight rate at 0.25pct and remain prepared to add to its current quantitative easing programme if required. At the start of the corona crisis the bank was quick to implement major liquidity programmes amounting to weekly asset buys of at least CAD5bln of Government of Canada bonds.

 

Since the crisis began, the bank has reduced its policy interest rate by a total of 150 basis points to 0.25pct, what the bank calls its "effective lower bound". Tiff Macklem’s first rate meeting at the helm of the Bank of Canada on Wednesday is expected to produce virtually the same policies set during the last meeting, according to economists.

(LiveSquawk – Continue Reading)

 

German Unemployment Up Sharply In May

Frankfurt, 3 June 2020 (LS NEWS) – Unemployment in Europe’s largest economy continued to climb in May while more than 1mln workers became eligible for the country’s Kurzarbeit short-term work programme, the Federal Labour Office in Nuremberg said Wednesday.

 

Jobless ranks swelled by a seasonally adjusted 238,000 last month versus the market estimate of 200,000 and the downwardly revised rise of 372,000 in April, the office said. The adjusted unemployment rate jumped to 6.3pct to surpass the forecast of 6.2pct and April’s 5.8pct reading.

 

“The unemployment report for May offers clear evidence that joblessness is in fact now rising even as the government’s Kurzarbeit scheme is being used liberally by firms,” said Claus Vistesen, chief Eurozone economist at Pantheon Macroeconomics.

(LiveSquawk - Continue Reading)

ECB Set To Expand, Extend PEPP – Analysts

Frankfurt, 2 June 2020 (LS NEWS) – Economists say the European Central Bank will add a half a trillion euros to its Pandemic Emergency Purchasing Programme (PEPP) and extend the scheme into 2021 amid concerns the Eurozone economy could contract by up to 10pct or more this year.

 

The ECB Governing Council’s two-day meeting is set to commence Wednesday, and policymakers are expected to hold interest rates at current levels as they drastically boost quantitative easing measures designed to support Eurozone economic activity slowed by Covid-19 lockdown restrictions.

 

GDP in the single-currency area fell a record 3.8pct in the first quarter, and many economists along with the ECB have said the contraction in the current three-month period will likely be even worse.
(LiveSquawk - Continue Reading)

Trump Backs Off Push To Federalize Forces Against Riots

A day after threatening to federalize forces to snuff out riots across the country, the president appears to be backing off the idea of invoking the Insurrection Act, sources familiar with his plans tell Axios.

 

What we're hearing: Aides say he hasn’t ruled out its use at some point, but that he's “pleased” with the way protests were handled last night (apart from in New York City, as he indicated on Twitter today) — and that for now he's satisfied with leaving the crackdown to states through local law enforcement and the National Guard.

 

"The law is absolutely still on the table if things get really bad, but as of now he doesn't think it's going to have to go that far,” an administration official tells Axios. A second official said Trump saw and continues to see the act as a mechanism only if governors can't contain chaos in their states.

(Axios - Continue Reading)

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