This from an investor briefing sent out today by Nomura, the Japanese bank:
- Even if the eurozone manages to get through August without the crisis taking a sharp turn for the worse, we believe that September could prove to be an even more challenging month for policymakers.
- The next Troika report on Greece, due in early September, could prove to be the crossroads moment for Athens.
- In Germany, we expect the constitutional court to approve ratification of ESM on 12 September, but the fiscal compact could prove more difficult, with yet more, and more difficult, cases set to follow.
- The Netherlands, too, is set to grab headlines on 12 September, when the general election is expected to result in an inconclusive outcome and protracted coalition negotiations.
- In Italy, parliamentary debates on electoral reform (ongoing) and the 2013 budget (forthcoming) threaten the stability of the Monti government as Silvio Berlusconi looks set to make a return to frontline politics.
- Portugal is struggling with fiscal slippage and increasing political tensions, suggesting that an attempt to renegotiate its bail-out terms may be imminent.
- In Spain, the government is struggling to maintain credibility with electors and markets alike. We believe a country bail-out package would be another serious blow.
- Possible bail-outs for Cyprus and Slovenia would add to policymakers’ woes and market concerns.
We therefore conclude that September – with its plethora of potentially destabilising events – promises to be a particularly testing, not to say dangerous, month, irrespective of what the ECB comes up with on 2 August.
