The Daily Shot

By SoberLook


Let’s begin with a few developments in the Eurozone.

1. The ECB balance sheet is approaching its 2012 peak – the central bank has been quite busy in May. The Eurozone’s monetary base hit a new high.

Source: ECB

Source: ECB

2. The ECB action (above) combined with weak employment data out of the US sent the average yield on German government bonds below zero for the first time.

Source: @fastFT

3. German factory orders dropped sharply, missing expectations by a significant margin. Both foreign and domestic demand has weakened.

Source: Statistisches Bundesamt

4. The short-term rate differential with the US suggests that the euro should weaken. However, the inflation-adjusted rate differential isn’t as large. Combine that with a more dovish Fed and all the talk of the euro going to parity remains just talk – for now.

Continue reading at TalkMarkets →

Subscribe to NFTRH Premium for an in-depth weekly market report, interim updates and NFTRH+ chart and trade ideas; or the free eLetter for an introduction to our work. You can also keep up to date with plenty of actionable public content at Or follow via Twitter @BiiwiiNFTRH, StockTwits or RSS. Also check out the quality market writers at