Photo: Wikimedia Commons
The week is off to a fairly quiet, but positive start in Europe.Markets are up, and there are even some murmurings about euro bonds making the round. That might be helping to calm things a little bit.
Nonetheless, the fire works should start fairly soon, probably no later than tomorrow, as there are two big events coming up.
First, tomorrow (Tuesday) is a big meeting between Merkel and Sarkozy. It’s hard to say what the expectations are for the meeting. If they come out with something substantive that will probably be a huge plus. If they come out with nothing, has the potential for big disappointment.
Then on Wednesday is a meeting of the Swiss National Bank, and everyone’s wondering: To peg or not to peg? Will it take a much harder stance towards limiting its appreciation against the euro, which would essentially be a form of QE. It’s gotten more activist in recent weeks, and the massive rally has been broken for now.
Something else to watch: This week the Netherlands will be holding big debates on participation in the EFSF. That vote is coming in October, but one reason it’s getting so much attention now is a recent poll showing that the Dutch basically want the Greeks out of Europe. How the Dutch debate plays out will be telling.