“Forget Brexit, there’s something far more worrying afoot in Europe: Italy’s debt problem. It’s on course to spark an existential crisis for Europe’s single currency area, the eurozone.
“While the European Union will aim to fix the problem it looks like they’ll be no escape from the coming calamity, experts say.
“”[…] it does seem a matter of ‘when’ rather than ‘if’ – another full-blown sovereign debt panic will happen,” states a recent report from London-based financial firm TS Lombard. The report continues bluntly:
“The bottom line is that as and when a serious new crisis blows up, the Italian government is positioning itself to demonstrate to its voters that it has not sought to leave the Eurozone, but rather that the Eurozone is leaving Italy.
“In other words, Italy’s government is gearing up to inform the European Union it has had enough. Then the ruling parties will tell Italy’s population that the EU is to blame for everything.”
“Maurizio Landini, the secretary general of the CGIL, Italy’s biggest trade union confederation, told an ANSA Forum on Thursday that the nation’s economic plight is getting worse rather than better.
“”We are not emerging from the economic crisis. The situation is deteriorating,” said Landini. The union chief said that Italy has lost 30% to 35% of its productive capacity over the last 10 years.”
“Italy’s populist government’s bid to avoid a European Union disciplinary action looks more daunting than ever, as a new report shows the country’s economic woes are likely to continue.”
“Britain will crash out of the EU on 31 October unless Theresa May’s Brexit deal is ratified or a new prime minister calls a second referendum or general election this summer, the bloc’s leaders have concluded.
“The Irish prime minister, Leo Varadkar, speaking at a summit in Brussels, said that there was now “enormous hostility” among the EU27’s heads of state and government to any further delay to Brexit.”
“France’s economy is having a weaker first half of the year than anticipated amid trade headwinds and the broadening slowdown in the euro area, according statistics agency Insee.”
“The last glimmer of positive yields on German bonds is in danger of being snuffed out. Thirty-year yields turning negative would be a first among major bond markets, with a global rally already having sent all of Germany’s out to 20 years below zero.”
“South Africa’s President Cyril Ramaphosa pledged on Thursday to speed up 230 billion rand ($16.11 billion) of support for ailing power utility Eskom, which he said was too vital to be allowed to fail.
“In his first state of the nation address since leading his party to victory in a May 8 election, Ramaphosa said Eskom’s financial position remains a matter of grave concern.”
“Palestinian officials said the financial blockade on the Palestinian Authority (PA) was intensifying, warning of a possible collapse if the situation remained the same…
“Over the past three months, the financial crisis has deepened in an unprecedented way when the PA refused to receive the money Israel collects on its behalf, after Tel Aviv deducted from it.”
“India’s flagging growth prospects and subdued inflation give room for decisive action through easing of both monetary and fiscal policies, minutes of the latest meeting of the country’s monetary policy makers showed. ‘Growth impulses have clearly weakened…”
“The volume-weighted average rate of China’s benchmark overnight repo for banks fell to 1.10 percent on Friday morning, the lowest level since June 2015.
“Traders attributed the decline in the interbank repo rate to ample cash conditions in the banking system following persistent central bank fund injections via open market operations in recent days to keep liquidity sufficient…”
“The Reserve Bank of Australia says a 5% drop in Chinese growth would depress Australian economic growth by 2.5% over three years, with commodity prices and equity prices taking a hit.
“In its latest bulletin, the central bank modeled how a shock slowdown in the Chinese economy could work its way through to Australia.”
“[Australia’s] Interest rates are heading for unprecedented lows below 1% and the Reserve Bank could even be forced into extraordinary measures such as money printing to stimulate the struggling economy, forecasters believe.
“The governor of the Reserve Bank, Philip Lowe, raised expectations that the cash rate will be cut again next month when he said on Thursday that “the possibility of lower interest rates remains on the table”.”
“The United States and Japan may need to shore up bank oversight to prepare for economic downturns, the head of the Federal Reserve Bank of Boston warned on Friday.
“Eric Rosengren, president of the Boston Fed, said in a speech that policymakers in the two major economies should consider whether regulators need more tools, including requiring banks to hold more capital now, to counteract economic risks.”
“The Bank of Japan kept its ultra-easy monetary policy unchanged Thursday, to underpin the economy amid growing uncertainty over a global economic outlook clouded by the U.S.-China trade war…
“The board voted unanimously to leave its massive asset purchase program unchanged.”
Death of the high street weighs on landlords round the world:
“Britons up and down the country have been deserting the high street in droves. The UK commercial property market has found itself at the centre of the storm affecting high streets and shopping centres.”
“Growth in global wealth ground to a halt in 2018 as major equity market corrections lowered the value of many investors’ assets, according to a report by Boston Consulting Group…
“When the firm adjusted for the rebounding dollar, wealth in 2018 actually declined by 1.6% instead of growing. “For the first time since 2008, we saw wealth growth was negative when you take into account all the factors,” Anna Zakrzewski, global leader of BCG’s wealth-management practice…”