European markets continue to show their comfort with the results of the bank stress test. Spain sold 3 month and 6 month bills at yields well below a month ago and even Hungary (no part of stress test but in IMF spat) sold more 3 month bills than expected. Yields are down across the board in southern Europe with Spanish yields in particular at 2 month lows and Greek 5 yr CDS near 2 month lows. The iTRAXX financial CDS is down another 7 bps to 111 bps, a 3 month low. UBS and DB both reported earnings better than expected, German Aug consumer confidence rose to the highest since Nov ’09 and the Euro is above 1.30 vs the US$ in response. EU LIBOR and Euribor though both rose. India joined Australia, Canada, Taiwan, South Korea, Thailand and Malaysia in removing accommodation as they raised their reverse repo rate by 50 bps, 25 more than expected and said “the dominant concern that has shaped the monetary policy stance in this review is high inflation.”
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.