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Now is the summer of our discontent

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  • The deposition of the Egyptian president may not on the surface have a huge impact for financial markets (Egypt's global importance focuses on Suez), but the struggle between democratic and majoritarian government rule is something that has echoes in other emerging markets today.
  • Portugal is conveniently reminding investors that the Euro area still has its problems and Greece has also offered its concerns to the mix. Although not seemingly as severe as other years, 2013 does seem preparing for a Euro summer problem or two. Spain auctions bonds today.
  • With this as a backdrop the ECB meets. Draghi has been at pains to point out that there are limits to monetary policy and the economic stimulus it can provide, but attention has perhaps now shifted more to the question of market stability (i.e. Portugal) and the press conference may see OMT questions asked.
  • The Bank of England meets under the chairmanship of its new governor, but with economic data reinforcing the idea of economic improvement (in an absolute and a relative sense) it seems very unlikely that any change will be offered to the policy stance.

Listen to the audio version of this briefing.