Lagarde’s yen for consensus will be stress-tested 11 Mar 2021 The ECB will step up the pace of bond-buying to combat a rise in yields. Moving sooner wouldn’t have allowed President Christine Lagarde to get the governing council’s green light. Fast-moving markets may require speedier reactions than her instinct for forging unity permits.
EU chip factory fantasy puts cart before horse 26 Feb 2021 Commissioner Thierry Breton wants an advanced semiconductor plant to cut reliance on Asia. The problem is that Europe’s chip designers and carmakers are ill-equipped to use such a cutting-edge site. Getting them on side, and investing more in research, is the place to start.
Insurers’ Brexit pleading deserves short shrift 24 Feb 2021 Domestic firms want the government to ease capital requirements following the UK’s departure from the EU. It’s true dividend restrictions mean they may already have ample capital. But amid a slump that’s not enough to make already confusing solvency metrics even more so.
Trading exodus is skirmish in City’s EU perma-war 11 Feb 2021 Some dealing in shares and derivatives shifted out of London in January after European regulators declined to recognise their UK counterparts. The tussle is a taster for bigger fights over clearing and fund management. Britain has many advantages, but few good ways to fight back.
Bubbly stocks risk painful vaccine puncture 29 Jan 2021 Drugmakers Pfizer and AstraZeneca are cutting deliveries of Covid-19 inoculations, the latest in a string of delays. Slower-than-expected rollouts and virus mutations may prolong lockdowns, hurting growth. Investors eyeing a rapid bounce-back this year could be disappointed.
EU strikes oafish first blow in new vaccine fight 26 Jan 2021 Brussels attacked drugmaker AstraZeneca for low deliveries of Covid-19 jabs and will impose checks on exports from the bloc. The move masks flaws in Europe’s inoculation rollout, and may do little to speed it up. It could trigger a new battle for access to coronavirus treatments.
Forces lowering euro zone inflation aren’t all bad 7 Jan 2021 Euro zone consumer prices fell 0.3% in December from a year ago. Several factors, especially a weak economy, are to blame. Still, a long-term trend that also chips away at inflation is cheaper tech. That’s not something even ECB chief Christine Lagarde would want to see reversed.
Corona Capital: U.S. college football 6 Jan 2021 Concise views on the pandemic’s corporate and financial fallout: U.S. college football programs are in a talent arms race for coaches, a bit like companies' quest for top-ranked CEOs, despite the pandemic's impact on revenue.
Brexit throws down electric gauntlet to UK cars 4 Jan 2021 Britain’s motor industry has escaped European Union tariffs that would have hobbled half its output. But to meet export rules on low-carbon vehicles by 2024, Prime Minister Boris Johnson needs to ramp up battery output. Convincing groups like Nissan and BMW to stay will be tough.
Christmas Eve Brexit deal is second-worst outcome 24 Dec 2020 The UK’s last-gasp agreement with the European Union avoids painful tariffs and a dangerous rupture in relations. Yet trade flows remain hostage to diverging standards. While the costs of exiting the single market will now become clear, the benefits of independence remain vague.
EU’s Google-Fitbit approval sets risky precedent 17 Dec 2020 Antitrust tsar Margrethe Vestager approved the $2.1 bln deal with conditions. The buyer’s pledges, like giving rival fitness trackers equal access to the Android operating system, are great in theory but hard to monitor. Vestager may only spot the loopholes once the harm is done.
ECB fiat anoints unlikely bank dividend heroes 16 Dec 2020 The regulator capped payouts as a proportion of earnings and assets. Well-capitalised lenders with richer valuations, like Nordea and KBC, now offer tiny yields compared with minnows like Liberbank. The risk is that a slow recovery causes restrictions to last beyond September.
Europe wields foam hammer at big U.S. tech groups 15 Dec 2020 Competition Commissioner Margrethe Vestager proposed new rules governing the behaviour of Amazon.com, Facebook and others. The potential fines are large, but that is a flimsy deterrent. Recommendations on sharing data with rivals are a neat idea but look narrow in scope.
Sheriffs take overdue ride into ESG wild west 15 Dec 2020 French and Dutch regulators have called for greater oversight of ratings and products that gauge companies’ green credentials. Nailing down a coherent approach will be tricky. But the breakneck growth of sustainable investing makes clearer ground rules critical.
Christine Lagarde’s baby bazooka needs backup 10 Dec 2020 The ECB boss will deploy emergency stimulus measures, such as asset buying and ultra-cheap loans to banks, for longer but came up with no new tricks to boost Europe’s economy. Central bankers have been innovative in the crisis. It’s now governments’ turn to do more of the work.
Judge Europe’s tech push in 2030, not 2020 8 Dec 2020 The bloc’s startups will raise $41 bln this year, venture firm Atomico reckons. It’s a fraction of America’s haul, and the region’s companies are still tiny by U.S. standards. Europe’s share of early-stage fundraising, however, is huge. That augurs very well for the future.
Chatty ECB has a communications problem 2 Dec 2020 Chief Economist Philip Lane has since March spoken with a series of financiers after policy meetings, his diary shows. A perception that a select few have privileged access is best avoided. The even bigger issue is why the central bank has to work so hard to land its message.
Corona Capital: Scotland, EU impasse, Amazon 27 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Scottish independence gets a viral shot in the arm; Poland and Hungary take a united stand on the European Union’s recovery fund; and the online retail giant delivers a modicum of Christmas cheer to workers.
Corona Capital: U.S. airlines 20 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: The CDC issued a warning to Americans not to travel over the upcoming Thanksgiving holiday as Covid-19 cases surge. Airlines, once again, are going hat-in-hand to Washington.
ECB has chance to avoid Fed’s strategy revamp flaw 12 Nov 2020 Christine Lagarde’s central bank is examining basics, like how it defines its price goal. Its U.S. peer earlier this year switched to aiming for inflation that averages 2% over time. But leaving things as vague as Jerome Powell did undermines efforts to lift price expectations.