Next week will be huge for the eurozone.A major shakeup is ahead for the European Central Bank, then the bank will make a new policy rate decision, and leaders of the Group of 20 will meet in Cannes.
There’ll be a ton of rumours circulating. We’ll hear lots about how well the deal struck Wednesday between EU leaders will work — if at all. And we’ll see if the rest of the world will get involved in bailing out the eurozone.
Here’s your schedule of events.
October flash inflation data for the eurozone comes out on Monday. Everyone will be looking to see whether inflation declines from the 3.0% annual number it hit in September.
Talk of a cut in interest rates by the European Central Bank has been circulating for months, amid signs of the eurozone's deteriorating economic position. However, another high inflation number could dissuade the bank's monetary policy committee from taking a more accommodative stance.
Italian Mario Draghi will take the top spot at the ECB from outgoing President Jean-Claude Trichet.
Everyone's been chattering about the likelihood that Draghi will spearhead more activist measures than the French Trichet, whose staunch commitment to price stability came under fire when he controversially cut rates earlier this year.
Draghi has hinted that he might be open to a rate cut soon. We'll see if he makes good on that.
The European Central Bank holds a meeting to decide on monetary policy.
Mixed reports are surfacing about what can be expected. UBS said today that it's looking for a 50bps rate cut, Bank of America and Morgan Stanley say they see a 25bps cut, but most investors expect that interest rates will remain unchanged.
Analysts have been endorsing a rate cut for months citing poor economic data and the deteriorating state of the sovereign debt crisis.
G20 leaders are set to meet in Cannes, France.
Crisis in the eurozone will undoubtedly be a prime topic of conversation, particularly after reports that China is expressing interest in contributing to the European rescue fund alongside the IMF.
The U.S. has been opposed to increasing the size of the IMF, and is unlikely to support participation in the bailout. This political divide is likely to deepen at the summit.
G20 leaders will also likely talk about that financial transaction tax German Chancellor Angela Merkel and French President Nicolas Sarkozy proposed in August, as well as ways of supporting banks that are 'too big too fail.'
The 17 finance ministers of the euro area -- the Eurogroup -- will meet, likely to discuss the implementation of the measures heads of state agreed upon at Wednesday's EU summit.
At the summit, EU leaders told reporters that these economic ministers would be responsible for working out a lot of the technical issues with these plans.
They'll probably spend most of their time talking about ways of leveraging the European Financial Stability Facility and implementation of a plan in which Greek bondholders will 'voluntarily' take 50% haircuts on Greek bonds.
Monday's Eurogroup meeting is followed by a meeting of Ecofin, which includes the finance ministers from all 27 EU states.
They'll probably discuss many of the same issues the Eurogroup discussed the day before, but they'll probably focus on proposals to change EU treaties and alter eurozone governance.
We could see a renewal of tensions between states that do and do not use the euro. Those tensions flared at a meeting of EU leaders last Sunday, but appeared to calm at a second summit on Wednesday.
Italy will hold its next bond auction on November 10.
Today's auction was poorly received, with yields topping 6.06% -- the highest level seen at an auction since Italy joined the euro.
Progress on domestic austerity measures as well as eurozone-wide measures to stem the crisis will determine if this auction fares any better.