Mar MNI analysts survey Feb Jan
median range
————————————————————————
Business sentiment: 109.8 109.5 108.2 – 110.7 109.7 108.4
Current conditions 117.4 117.0 116.3 – 118.3 117.4 116.3
Six-month outlook: 102.7 102.9 101.5 – 104.0 102.4 100.9
–

FRANKFURT (MNI) – German business morale surprised to the upside in
March, extending its run of increases to five months on a more positive
view of the near-term outlook, the Ifo institute reported on Monday.

Taking into account modest upward revisions in both February and
January, further improvement in March brought the Ifo headline figure to
109.8, its highest level since last July. Still, the gain this month was
the smallest in nearly a year.

“The German economy is losing some of its momentum,” Ifo President
Hans-Werner Sinn said in a press release.

Current conditions unexpectedly stabilized in March at a five-month
high of 117.4. While weaker than forecast, expectations maintained their
upward trend, gaining 0.3 point to 102.7, the best result since July.

Sentiment within the manufacturing sector fell 0.3 point to 14.0 in
March following two months of growth, as a downward revision in the
current business situation offset a more favourable forward outlook.
Respondents said they planned to increase staffing further, though by
less than last month. Businesses also reported favourable impulses from
foreign demand.

Construction morale also lost some ground, slipping one full point
to 2.3 on the back of a downward revision in the six-month outlook.
Still, the indicator remains above zero, pointing to overall optimism in
the sector.

After hitting a seven-month high in February, morale among
wholesalers slipped 2.2 points to 12.8 in March, with both the current
situation and expectations falling.

Conversely, retailers were more optimistic this month, citing
improvements in their current situation and a brighter six-month
horizon.

In services, morale fell back half a point to 22.4 in March, due
mainly to a weaker current conditions assessment. However, while
respondents also revised down their expectations for the next six
months, they still looked to add to staff, Ifo reported.

The further improvement in the Ifo business climate is reassuring
after the unexpected setback in the March manufacturing PMI (48.1),
which slipped into contraction territory for the first time since late
last year, as companies pointed to fewer new orders, lighter workloads
and reductions in staff.

The decline in the services PMI (51.8) was less severe, though
still pointed to moderating business activity, only a modest rise in new
work, and the slowest pace in employment growth since early 2010.

Growth “will not be as positive” this year as in 2011, Finance
Minister Wolfgang Schaeuble said a week ago, noting that the economy is
“very vulnerable” to global trends.

The Bundesbank expects average GDP growth of 0.6% this year after
3.1% last year. Yet despite a less favorable environment, the economy is
in “remarkably good shape,” President Jens Weidmann said last week.

In its latest monthly bulletin, the central bank suggested that
unseasonably cold temperatures likely weighed on economic activity last
month, and it pointed to an expected recovery in the spring.

– Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com –

[TOPICS: M$G$$$,MT$$$$,M$X$$$,M$XDS$,MAGDS$,MTABLE]

Just pugged a day’s low of 1.3195, but  EUR’s finding some support under 1.3200 for the moment

Talk of some large expiries today at 1.3250, and some stops on a break down of 1.3190 ahead of bids  down at 1.3160/70 and larger at 1.3135/40

EUR/USD’s at 1.3205

There are sell stops down through 1.0420 and we,ve just been down to a day’s low of 1.0427.

Below here lies the 200 DMA tech support at 1.0400 and 1.0375 which is the 100 DMA

AUD/USD’s getting some support from a falling EUR/AUD down to 1.2655 from 1.2704 European session highs.

Supposedly large offers sitting up in front of 83.00, with the USD hitting high’s of 82.92, but likely stops are seen on a break 0f 83.00, which may well boost the dollar and start a run higher again towards the recent 84.18 highs.

On the downside bids are sitting down at 82.20/30 with sell stops on a break of 82.20

• Inflation and oil price level not a big danger at the moment for firms, but poses potential risk
• Firms are getting used to the euro zone debt crisis, no sign that it is having a strong influence on them
• ECB interest rate level is appropriate
• Gain in Ifo shows that mini-recession in Germany can be avoided

Reuters reporting.

Up from revised 94.4 in February (prev 94.2) and demonstrably stronger than Reuter’s median forecast of 93.7.

Combo of better than expected German Ifo and Italian consumer confidence has given EUR/USD a bit of a lift and we’re up at 1.3260 (circa 1.3238 when data came out)

Stronger than Reuter’s median forecast of 109.6.

• Pledges surplus budgets each year if in power

• Spain govt to make additional budget decisions soon
• Spain has major employment-related challenges
• Spain making determined efforts to combat slump
• Wants to examine Finland austerity measures carefully
• Finland austerity moves point in right direction

Bloomberg reporting.

• Italy, Spain ‘very determined’ in budget efforts
• Strengthening confidence in Europe is top priority
• His goal is ‘strong enough stability mechanism’
• ‘Complete solution’ needed to calm situation
• Recession may be short as long as euro zone govts commit to austerity measures

Down from -1.5 pts in February.

M3 – February Private HICP (flash)
%yoy 3ma (%yoy) Lending (%yoy) %yoy

Median Forecast 2.3 2.2 1.1 2.5
High forecast 2.7 2.3 1.3 2.7
Low forecast 1.7 2.1 1.1 2.2
Previous period 2.5 2.0 1.5 2.7
-
Number of responses 17 10 3 14
-
4Cast 2.7 2.2 N/A 2.5
ABN AMRO 2.2 N/A N/A 2.6
Barclays Cap. 1.7 N/A 1.1 2.6
Berenberg Bank 2.7 N/A 1.3 2.6
BNP Paribas 2.2 2.1 N/A N/A
BoA-ML N/A N/A N/A 2.5
Capital Economics N/A N/A N/A 2.5
Citi 2.2 2.1 N/A 2.3
Commerzbank 2.1 N/A N/A 2.5
DZ Bank 2.0 N/A N/A 2.2
Danske 2.3 N/A N/A N/A
ING 2.3 2.1 N/A N/A
Lloyds Bank N/A 2.3 N/A 2.4
LBBW 2.5 N/A N/A 2.7
Natixis 2.3 2.1 1.1 2.4
Soc. Generale 2.4 2.3 N/A N/A
Standard Chartered 2.7 2.3 N/A 2.6
UBS 2.5 2.2 N/A N/A
Unicredit 2.3 N/A N/A 2.7
West LB 2.0 2.1 N/A N/A
–
Economics Industry Services Business
Sentiment Sentiment Sentiment Climate
– March – – March – – March – – March -

Median Forecast 94.2 -6.0 -1.0 -0.2
High forecast 95.0 -5.0 0.5 -0.1
Low forecast 93.8 -7.0 -1.1 -0.3
Previous period 94.4 -5.8 -0.9 -0.18
-
Number of responses 14 10 5 7
-
4Cast N/A -5.0 N/A -0.2
ABN AMRO 94.1 N/A N/A N/A
Barclays Cap. N/A N/A N/A N/A
Berenberg Bank 95.0 -6.5 0.5 -0.1
BNP Paribas 94.6 -5.6 N/A N/A
BoA-ML N/A N/A N/A N/A
Capital Economics N/A N/A N/A N/A
Citi 94.0 -6.0 N/A N/A
Commerzbank 94.0 -6.0 -1.0 N/A
DZ Bank 94.2 N/A N/A N/A
Danske N/A N/A N/A N/A
ING 94.2 -6.0 -1.1 -0.2
Lloyds Bank N/A -5.7 N/A N/A
LBBW 94.4 N/A N/A N/A
Natixis 93.8 -7.0 -1.0 -0.2
Soc. Generale 94.0 N/A N/A -0.2
Standard Chartered 94.8 -6.0 -0.8 -0.2
UBS N/A N/A N/A N/A
Unicredit 94.4 N/A N/A N/A
West LB 94.6 -5.0 N/A N/A
Westpac 94.1 N/A N/A -0.3
———————————————————————–
* Median is based on above forecasts and is not intended to represent
a consensus.

The survey was conducted on Friday, March 23.

[TOPICS: MTABLE,M$GDS$,M$G$$$,M$XDS$,M$X$$$]

Ifo – March
Business Current Expec-
Climate Situation tations

Median Forecast 109.5 117.0 102.9
High forecast 110.7 118.3 104.0
Low forecast 108.2 116.3 101.5
Previous period 109.6 117.5 102.3
-
Number of responses 19 11 11
-
4Cast 110.7 117.7 103.7
ABN AMRO N/A N/A N/A
Barclays Cap. 109.2 117.0 102.0
Berenberg Bank 109.0 116.9 103.4
BNP Paribas 109.6 116.7 103.0
BoA-ML 109.5 N/A N/A
Capital Economics N/A N/A N/A
Citi 110.0 N/A N/A
Commerzbank 109.5 N/A N/A
DZ Bank 110.3 118.3 103.1
Danske 108.2 116.3 102.0
ING 109.2 117.5 101.5
Lloyds Bank 110.0 N/A N/A
LBBW 110.0 N/A N/A
Natixis 109.2 116.5 102.0
Soc. Generale 110.5 117.5 104.0
Standard Chartered 110.0 117.9 102.9
UBS 109.2 117.0 102.0
Unicredit 110.2 N/A N/A
West LB 109.5 N/A N/A
Westpac 109.5 N/A N/A
–

Import Prices GfK
– February – Consumer Morale
%mom %yoy – April -

Median Forecast 1.0 3.1 6.1
High forecast 1.1 3.7 6.5
Low forecast 0.6 2.9 5.9
Previous period 1.3 3.7 6.0
-
Number of responses 5 5 13
-
4Cast N/A N/A 6.0
ABN AMRO N/A N/A N/A
Barclays Cap. N/A N/A N/A
Berenberg Bank N/A N/A 5.9
BNP Paribas 1.0 3.5 N/A
BoA-ML N/A N/A N/A
Capital Economics N/A N/A 6.5
Citi 0.6 3.1 N/A
Commerzbank N/A N/A 6.0
DZ Bank N/A N/A 6.2
Danske N/A N/A N/A
ING N/A N/A 6.1
Lloyds Bank N/A N/A 6.1
LBBW N/A N/A 5.9
Natixis 1.1 3.7 6.1
Soc. Generale N/A N/A N/A
Standard Chartered N/A N/A 6.0
UBS 1.0 N/A 6.1
Unicredit N/A 2.9 6.0
West LB 0.8 3.0 6.2
Westpac N/A N/A N/A
–

CPI (flash) HICP (flash)
– March – – March -
%mom %yoy %mom %yoy

Median Forecast 0.4 2.2 0.3 2.2
High forecast 0.6 2.3 0.4 2.3
Low forecast 0.3 2.0 0.2 2.1
Previous period 0.7 2.3 0.9 2.5
-
Number of responses 10 15 9 9
-
4Cast 0.3 2.1 0.3 2.2
ABN AMRO N/A 2.2 N/A N/A
Barclays Cap. 0.3 2.1 0.3 2.3
Berenberg Bank N/A 2.3 N/A N/A
BNP Paribas 0.4 2.3 0.4 2.3
BoA-ML N/A 2.2 N/A N/A
Capital Economics N/A N/A N/A N/A
Citi 0.4 2.2 0.4 2.2
Commerzbank 0.3 2.1 N/A N/A
DZ Bank N/A N/A 0.2 2.1
Danske N/A N/A N/A N/A
ING 0.6 2.3 N/A N/A
Lloyds Bank N/A N/A 0.4 2.3
LBBW N/A 2.3 N/A N/A
Natixis 0.3 2.1 0.3 2.2
Soc. Generale 0.3 2.1 0.4 2.3
Standard Chartered 0.5 2.3 N/A N/A
UBS N/A N/A 0.3 2.2
Unicredit N/A 2.0 N/A N/A
West LB 0.4 2.2 N/A N/A
Westpac N/A N/A N/A N/A
–

Unemployment
– March – Retail Sales
change rate – February -
(’000s) (%) %mom %yoy

Median Forecast -10.0 6.8 1.5 0.2
High forecast 15.0 6.8 1.9 1.7
Low forecast -16.0 6.7 0.8 -0.3
Previous period 0.0 6.8 -2.3 -1.5
-
Number of responses 13 12 7 4
-
4Cast 12.0 6.8 N/A N/A
ABN AMRO 5.0 6.8 N/A N/A
Barclays Cap. N/A N/A 1.5 1.7
Berenberg Bank -10.0 6.7 0.8 N/A
BNP Paribas -5.0 6.8 1.0 -0.3
BoA-ML N/A N/A N/A N/A
Capital Economics N/A N/A N/A N/A
Citi 5.0 N/A N/A N/A
Commerzbank -10.0 N/A N/A N/A
DZ Bank -15.0 6.8 N/A N/A
Danske N/A N/A N/A N/A
ING N/A 6.7 1.5 0.2
Lloyds Bank -15.0 6.8 N/A N/A
LBBW N/A 6.8 N/A N/A
Natixis -5.0 6.8 1.9 0.1
Soc. Generale 15.0 6.8 N/A N/A
Standard Chartered -15.0 6.7 N/A N/A
UBS N/A N/A N/A N/A
Unicredit -10.0 N/A 1.5 N/A
West LB -16.0 6.8 1.2 N/A
Westpac N/A N/A N/A N/A
—————————————————————–
* Median is based on above forecasts and is not intended to represent
a consensus.

The survey was conducted on Friday, March 23.

[TOPICS: MTABLE,M$GDS$,M$G$$$,M$XDS$,M$X$$$]

Consumer
Consumer Spending
Morale – February -
– March – %mom %yoy

Median Forecast 82 0.3 -2.2
High forecast 83 0.5 -2.2
Low forecast 80 -0.8 -3.4
Previous period 82 -0.4 -2.2
-
Number of responses 8 6 3
-
ABN AMRO 82 0.3 N/A
Berenberg Bank 83 0.2 N/A
BNP Paribas 81 N/A N/A
Citi 83 -0.8 -3.4
Commerzbank N/A 0.4 -2.2
ING 80 N/A N/A
Natixis 83 0.5 -2.2
Soc. Generale 82 N/A N/A
West LB 82 0.2 N/A

———————————————————————–
* Median is based on above forecasts and is not intended to represent
a consensus.

The survey was conducted on Friday, March 23.

[TOPICS: MTABLE,M$GDS$,M$G$$$,M$XDS$,M$X$$$]

• But can’t see eurobonds coming into being soon
• Eurobonds require full trust between euro governments
• Complete trust between European governments lacking
• Greece must deliver on commitments to EU
• Cannot envision Greece leaving the euro
• Portugal, Spain situations different from Greece
• Spain’s new govt forceful in implementing reform

EUR/USD sits at 1.3250, exactly where it was when I sat down two and a half hours ago.

• It’s important progress made in European crisis
• Monti making real efforts to boost Italy’s economy
• ECB has taken decisive actions
• ECB’s unconventional steps have helped bond market
• Banks benefit from ECB’s actions
• Makeup of European firewall not clear yet
• Global discussion needed on boosting IMF funds
• Japan has bought 12% of EFSF bonds
• Japan has bought 3.3 billion euro of EFSF bonds

Bloomberg reporting.

Elsewhere

• Japan MOF currency tsar Nakao:  EFSF bonds are safe, attractive assets for Japan foreign reserves.

Reuters reporting.

DAX and CAC 40  futures up +0.4%.

FRANKFURT (MNI) – Germany’s powerful IG Metall Union is confident
there will be notable wage increases, IG Metall head Berthold Huber
told the German daily Die Berliner Zeitung on Saturday.

“I am optimistic that we will push through a decent pay rise,”
Huber said. Europe’s biggest union is calling for a 6.5% pay increase
over the coming 12 months.

IG Metall has 3.6 million members in the metals and electronics
industries. The sector employer association Arbeitgeberverband
Gesamtmetall has rejected demands, noting that the union can justify
only around 3% with productivity and inflation developments.

Workers at the German car maker Opel, who are negotiating a
separate deal, also expect to see a boost in wages. The works
committee’s head told Berliner Zeitung he expected to see an increase
of “at least 4%.”

-Frankfurt newsroom +49 69 72 01 42; e-mail: jtreeck@marketnews.com

[TOPICS: M$X$$$,MGX$$$,M$G$$$]

PARIS (MNI) – European Central Bank Governing Council member
Athanasios Orphanides is unlikely to be reappointed as governor of the
central bank of Cyprus and as a result would no longer hold that
country’s seat at the ECB, the Financial Times reported Sunday.

The newspaper said the government in Nicosia is signalling that
Orphanides will not be reappointed when his five-year term expires at
the end of next month.

Orphanides has been in conflict with the communist government of
Cyprus over its unwillingness to cut spending and reform the economy.
That makes his reappointment unlikely, the FT said, citing sources
familiar with the government’s thinking. It quoted one such source as
saying that “nobody in the banking sector expects him to stay.”

Orphanides, who spent a considerable amount of time earlier in his
career at the U.S. Federal Reserve in Washington, D.C., is considered an
intellectual heavyweight in central banking circles, and he is known to
have made substantial contributions to internal ECB policy debates.

Orphanides warned the Cypriot government early on that without
quick action to slash budget deficits it would face serious problems in
the face of the financial crisis. The government did not act as
Orphanides urged, and its shaky fiscal situation has led many to believe
that it could be another Eurozone country in need of a bailout.

–Paris newsroom, +331-42-71-555-40; bwolfson@marketnews.com

[TOPICS: M$X$$$,M$$EC$,M$Y$$$,M$$CR$,MGX$$$]

TOKYO (MNI) – The European Central Bank must unwind its
non-standard policy measures as soon as market conditions permit and
will have the tools to do so, ECB Executive Board member Benoit Coeure
said Monday.

“We can withdraw the ample liquidity created as a side-effect of
the long-term operation whenever the Governing Council deems liquidity
conditions are excessive in view of the outlook for price stability,”
Coeure said in a text for delivery to a conference here.

“All the tools necessary for large-scale liquidity withdrawal are
already in place or will be readily available when needed,” he assured.

A “timely exit” from these measures “and a return to a less
accommodative policy stance – once the economic conditions are ripe –
are essential,” Coeure stressed.

Loose monetary policy over time could “fuel excessive risk-taking,
leverage and asset price bubbles” and make banks, companies and
governments addicted to low rates and dissuade them from cleaning up
their balance sheets, he cautioned.

“At present, we are seeing some encouraging, albeit early, signs of
normalization across financial market segments,” Coeure said. He noted
the pick-up in M3 money supply growth and lending in January, as well as
the decline of stock market volatility and money market credit spreads.

The role of the ECB is not to cure the “root cause” of the current
crisis: weak fiscal institutions, diverging competitiveness among
Eurozone countries and low potential growth due to delayed structural
reforms, he stressed.

Indeed, if there is a silver lining in the crisis, it might be the
obligation “to pursue sustainable state finances and to undertake the
necessary structural reforms,” he said. “Switching this mechanism off
would weaken incentives to conduct the right economic policies.”

“Some” governments “have taken important steps towards addressing
the root cause of market malfunctioning,” he noted. Mechanisms for
tighter collective fiscal surveillance are being created and “might
become the first step towards a fully-fledged fiscal union.”

Armed with graphs and equations, Coeure resumed the success story
of the ECB in assuring price stability over the medium term and keeping
financial markets functioning during the worst crisis since the second
world war.

The recent overshoot in inflation is due mainly to volatile energy
prices and “certainly remains within the strictest tolerance bands,” he
asserted.

Moreover, the Eurozone economy has enjoyed relative stability —
second only to that of Switzerland — and produced a rise of GDP per
capita comparable to that of the United States, he showed.

“Borrowing money in the euro area is cheaper today – in real and
nominal terms – than it was a decade and a half ago, and the lower cost
of borrowing is largely related to a less uncertain and a more
predictable macroeconomy,” he argued.

[TOPICS: M$X$$$,M$$CR$,M$$EC$,MT$$$$,MGX$$$]