The Left party is set for victory in the German state of Thuringia, exit polls showed for the regional assembly. The far-right AfD also marked a successful night, doubling its score from five years ago. Source Deutsche Welle
Geostrategic Countries
U.S. private hiring was less than forecast in September as wage gains cooled, offering a warning that the record-long expansion may be starting to falter even as the jobless rate fell to a half-century low. Source: Bloomberg
- The ISM U.S. manufacturing Purchasing Managers’ Index plunged to 47.8% in September, the lowest since June 2009.
- This marks the second consecutive month of contraction.
- The ISM employment gauge for the sector dropped to the lowest since January 2016.
Germany’s economic output turns out even weaker as its manufacturing PMI for September misses expectations. Analysts forecast the PMI to be 44, while official figures show the index to be at 41.4. Source: Bloomberg
- The Federal Reserve says overall consumer borrowing increased by $23.3 billion in July after a $13.8 billion advance in June.
- It was the biggest monthly gain since a $29.9 billion jump in November 2017.
- Borrowing in the category that covers auto and student loans also posted a sizeable gain.
It’s the weakest headline reading since November 2012 and this will continue to suggest that Germany is tilting towards a technical recession currently with the economic slowdown showing no signs of stopping. Source: Forexlive
Retail sales in China grew 7.6% year on year, below the consensus of 8.6%, and Fixed-asset Investment (FAI) growth slowed to 5.7% in the first seven months of the year. The readings showed weakness across the board on both the demand and supply sides of the Chinese economy, Bloomberg Economics said, adding that policy support will likely be stepped up in the coming months. Source: Bloomberg Economics
The Russian Pacific Fleet has kicked off large-scale drills in the central part of the Pacific Ocean, Russia’s Defense Ministry reported on Thursday. “In accordance with the plan of training military command centers of the Pacific Fleet’s forces (troops) in 2021, an operational exercise of the Fleet’s combined arms forces is running in the distant maritime zone,” the ministry said in a statement. Source Tass
Lofven says he’ll now talk to his allies in parliament to figure out whether he can still patch together a viable coalition. Failing that, he may call a snap election, he said after losing Monday’s vote. If Swedes are forced to head to the polls early, it would be the first time since 1958. If Lofven resigns, the speaker of parliament will ask the biggest parties to try to form a new government until scheduled elections take place next year. Source Time
A massive car bomb attack targeted France’s Barkhane force in the central Malian town of Gossi on Monday injuring several soldiers, local sources told FRANCE 24. The attack occurred in the Kaigourou neighbourhood of Gossi in central Mali injuring several soldiers operating under France’s Operation Barkhane in Sahel, according to local sources. Witnesses said several military helicopters could be seen heading to the area after the massive explosion to evacuate the wounded. Source France24
Fifty of Afghanistan’s 370 districts have fallen to Taliban militants since May, according to the UN’s special envoy on Afghanistan Deborah Lyons, as the United States continues its military withdrawal from the country. Source CNN
Recent commercial satellite imagery reveals that China has made substantial progress in the construction of its third aircraft carrier, commonly known as the Type 003. The vessel is slated to become the largest surface combatant in the Chinese People’s Liberation Army Navy (PLAN) and significantly upgrade China’s naval capabilities. Source CSIS
“My assessment, in terms of capability, I think China has a ways to go to develop the actual, no-kidding capability to conduct military operations to seize through military means the entire island of Taiwan, if they wanted to do that,” Chairman of the Joint Chiefs of Staff Gen. Mark Milley told the Senate Appropriations Committee. Source MSN
Royal Mail has banned 100,000 posties from flying England flags during Euro 2020 – as patriotic postmen blasted bosses for their ‘woke attitude.’ All flags – of England and other countries – are barred from the firm’s 45,000 vans and lorries. Source Daily Mail
Greek Foreign Minister Nikos Nikos Dendias has expressed disappointment over Germany’s sale of submarines to Turkey, a move he says will change the balances in the Aegean Sea in favour of Ankara.
Dendias held a meeting on Wednesday (16 June) in Athens with Nils Schmid, the Social Democrat (SPD) parliamentary group’s spokesperson for foreign affairs in the German parliament. Source Euractiv
The steel cutting ceremony for the fourth Turkey-made corvette tailored for Pakistan’s navy was held in the southern port city of Karachi Tuesday. Source Daily Sasbah
The Taiwanese Ministry of National Defense said 28 People’s Liberation Army aircraft entered Taiwan’s air defense identification zone from the southwest on Tuesday. The aircraft included fighter jets and nuclear-capable bombers, and they flew in six distinct groups, according to a ministry news release and an accompanying graphic. Source Defence News
In a communique issued by governments attending the meeting of the North Atlantic Council in Brussels yesterday, the military alliance revealed it had endorsed a Comprehensive Cyber Defence Policy, in which a decision will be taken to invoke Article 5 “on a case-by-case basis” following a cyber-attack. Under Article 5 of the NATO treaty, first signed in 1949, when any NATO ally is the victim of an armed attack, it will be considered an attack on all alliance members, who will theoretically take any actions necessary to defend that ally. Source Info Security
BP (BP.L) will continue producing hydrocarbons for decades to come and will benefit from rising oil prices even as it reduces output as part of its shift to low-carbon energy, Chief Executive Bernard Looney told Reuters on Tuesday. Source Reuters
Natural gas prices on European spot markets climbed to $360 per 1,000 cubic meters and continue growing on the back of high demand and low reserves in underground gas storages. The price is almost $100 above the February maximum, Gazprom told reporters on Wednesday. Source Tass
Russia’s Nord Stream 2 gas project will start preparations on Friday to fill the first of two pipelines with natural gas within a few months, the Gazprom-led project said on Thursday. Nord Stream 2, which runs on the bed of the Baltic Sea from Russia to Germany, bypassing Ukraine, has faced criticism from the United States, which says it will increase European reliance on Russian gas. Source Reuters
U.S. crude oil was $71.50 a barrel on Monday — its highest price since October 2018 — and Brent crude oil, the international benchmark, topped $73 a barrel.
Crude oil prices have risen steadily since the start of the year as businesses reopen and demand for air and auto travel bounces back. As of Monday, U.S. crude oil is about $23 a barrel more expensive than it was in January. Source MSN
The European Commission is preparing a case to assert the primacy of EU courts over rulings from Germany’s Federal Constitutional Court. The issue relates to the buying of government bonds by the European Central Bank. Brussels is expected to launch an infringement procedure against Germany after a ruling by the country’s Federal Constitutional Court that is seen as incompatible with European Union law. Source Deutsche Welle
Europe has been “forged in the crises” and therefore must emerge strengthened from the pandemic, for example, by making permanent mechanisms such as the EU Recovery Fund or the Sure Fund, said Bank of Italy Governor Ignazio Visco on Monday.
Visco also said the EU mechanisms are “common debt, well distinct” from the “previous debt of the single countries, which would remain national responsibility”, even if a part of this could enter into common management, “for example through an amortisation fund”. Source Euractiv
Testing work on Russia’s Nord Stream 2 gas pipeline to Germany will start next week, Alexander Drozdenko, governor of the Leningrad region where the pipeline starts, was cited as saying by the TASS news agency on Wednesday. Source Reuters
Russia has outmaneuvered Kiev by overcoming Western objections to its Nord Stream 2 pipeline, Ukraine’s President Volodymyr Zelensky has said, warning that Moscow could cut his country off from energy supplies once it is complete.
The politician made the claims in an interview with Germany’s Frankfurter Allgemeine Zeitung, published on Monday. He claimed that the pipeline, which will link Siberian gas fields to consumers in Western Europe by means of a conduit under the Baltic Sea, was a “trump card” for Moscow. Now, he claimed, the Kremlin has a “royal flush” because it was supported by leaders in countries like Germany and France. Source RT
President Joe Biden on Friday laid out a $6 trillion budget proposal that would increase the national debt to a percentage of the economy higher than it was in World War II, creating an opening for Republicans to increase their attacks on his ambitious spending proposals as too expensive. source USA Today
An Italian bank has collapsed through exposure to Greensill Capital and GFG Alliance, as the shockwaves from the failure of the British finance company claimed another casualty.
Milan-based Aigis Banca, a specialist lender to small and medium-sized businesses, was ordered into liquidation by the Bank of Italy at the weekend, with larger peer Banca Ifis buying its assets and liabilities for the symbolic price of €1 ($1.60). Source Financial Review
The US has partly lifted sanctions on a controversial gas pipeline in a bid to mend relations with Germany and Russia. Source Euobserver
