GERMANY: Bundesrat Set To Sign Off On Debt Brake Reform Tomorrow
The Bundesrat (Federal Council), sometimes described as the upper house of the German parliament, is set to vote on the reform to the constitutional debt brake and formation of an E500B infrastructure fund tomorrow (21 March). The reforms were passed by the required two-thirds majority in the Bundestag earlier this week and will require the same majority in the Bundesrat.
- The plenary session starts at 0430ET/0830GMT/0930CET. The Bundesrat has confirmed that it "will vote on the amendments for the finance package directly at the beginning of the plenary session". A live stream can be found here.
- Before the vote, 11 speakers have been designated time to deliver addresses (almost all are state minister-presidents or equivalent). Under the Rules of Procedure, "the standard speaking time for each speaker shall be five minutes per agenda item; the maximum speaking time of 15 minutes shall not be exceeded," although "The President may extend the speaking time if the subject matter or the course of the debate so require."
- Should the speakers stick to the usual five minute timeframe, then taking into account time in between speakers and other procedural matters, the vote could come in the mid-to-late morning CET. However, should speakers go on for the full 15 mins (or longer) then the session could stretch into the afternoon before a vote.
- As we highlighted earlier in the week, the states supportive of the reform should have enough votes to carry the two-thirds supermajority threshold (see 'GERMANY: Bundesrat Should Not Prove Obstacle To Debt Brake Reform', 1129GMT, 18 Mar).
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
FOREX: USDJPY Steadily Eroding Overnight Gains
- Higher core yields overnight assisted the weakness for the Japanese Yen, prompting USDJPY to rise around 100 pips from the lows to an overnight peak of 152.22. However, a subsequent reversal in fixed income markets and the weakness seen for major equity indices have bolstered the JPY recovery.
- As such, USDJPY has been slowly grinding lower and currently trades around unchanged levels on the day. Price action narrows the gap to the overnight lows of 151.24 and below here, focus will be on the bear trigger at 150.93, the Feb 7 low.
- Clearance of this level would resume the bear cycle that started on Jan 10, and would target 149.69 (Dec 9 low) and 148.65, the Dec 3 low and a key support.
- In Japan, trade data will be released overnight before the focus turns to national CPI readings on Thursday. In the US, the FOMC minutes have the spotlight. Details surrounding the most recent adjustments to the January statement, as well as any discussion or analysis regarding the potential impact of the new presidential administration's policy shifts will be scrutinised.
US: Trump & Musk To Appear In Fox Interview Tonight @ 2100ET
President Donald Trump and special government employee Elon Musk will appear in an exclusive Fox News interview tonight (18 Feb) at 2100ET (0200GMT, 0300CET, 1100JST). The sit-down with Sean Hannity is set to focus on the Musk-led Department for Government Efficiency (DOGE), and Trump's first 100 days in office. It will be the first joint interview for the two men.
SEK: Technical Conditions In SEK Crosses Remain Bearish
Technical conditions in key SEK crosses remain bearish. Markets have had little reason to reassess February's krona strength in the last two sessions, with European equities still performing strongly and the Swedish January final inflation report exposing broad-based price pressures to start the year.
- EURSEK is on track for an 11th downward session in the last 12, now 2.6% below the Jan 31 close. The 14-day RSI is off multi-year lows, but still lies in oversold territory. Initial support is the June 20 low at 11.1824, before the Feb 22 2024 low at 11.1385.
- NOKSEK is consolidating below the December 20 low at 0.9625, with the Sep 26 low at 0.9572 the next key support.
- The 50% retracement of the September to January bull leg at 10.6811 has contained downside in USDSEK the last three sessions. Clustered resistance is seen around the Feb 13 high at 10.8877 and the 20-day EMA at 10.9087, with shallower rallies considered corrective.
- Riksbank First Deputy Governor Breman will speak on Thursday, but SEK crosses may be more sensitive to swings in global risk sentiment (e.g. Russia/Ukraine peace prospects and ad hoc tariff-related headline flow from the US) and the Eurozone flash PMI on Friday.
