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• Intl lenders mulling a 9 bln eur return of ECB profits, up to 8 bln in interest rate cut on loans among measures to cut Greek debt – Greek FinMin source
• UK BBA: Oct Mortgage Approvals 33,039 Vs 31,544 Sep
• Draghi: ECB reacted to crisis proactively
• Ifo: Germany Business Morale Beats Expectations In November
• BBK Lautenschlaeger: U.S. Banks In The EU Could Feel The Heat
• UK DATA: BBA Oct mortgage approvals 33,039 vs 31,544.
• UK Oct Mortgage approvals rise to 37,129 from 29,975 in Sept
• German parliament rejects treaty on undeclared Swiss bank accounts
• Ifo economist: Exports of German firms to Asia and USA are going very well, industrial orders are stabilising
• Update: S&P Affirms France’s AA+/A-1+ Rating;Outlook Negative
• ITALY DATA: Sept seas adj. nominal retail sales:…..
• German November Ifo business climate 101.4
• Italian Sept sa retail sales +0.1%m/m , -1.7% y/y (unadj)
• BUBA’s Lautenschlaeger: Still expects the US to implement Basle 111
• Don’t mess with the Chinese government…
• S&P Affirms France’s AA+/A-1+ Rating; Outlook Still Negative
• Spanish October PPI -0.1% m/m,+3.5 % y/y
• EUR/USD poll-time!!
• FRANCE DATA: November mfg sentiment 88 vs October 85.
• French manufacturing industry morale rises to 88 in November

Intl lenders mulling a 9 bln eur return of ECB profits, up to 8 bln in interest rate cut on loans among measures to cut Greek debt – Greek FinMin source Posted: 23 Nov 2012 01:55 AM PST Also mulling cutting Greek debt by 10 bln eur  via debt buyback and extending maturities Greek Finance Ministry is already preparing procedures for debt buyback If approved by Eurogroup, Greek debt buyback could be completed by year-end

UK BBA: Oct Mortgage Approvals 33,039 Vs 31,544 Sep Posted: 23 Nov 2012 01:50 AM PST -UK BBA: Oct sa remortgage approvals 20,112 vs 19,929 Sep -UK BBA Oct Net Change in mortgage amount outstanding +stg73mn LONDON (MNI) – Mortgage approvals saw a slight increase in October, rising to 33,039 from 31,544 in September, in line with other data THAT poinTS to a tentative and muted revival of the UK housing market. The British Bankers’ Association also showed approvals were the highest since January this year, but were still below the level seen in October 2011 when they totalled 34,603. The net change in mortgage loans outstanding was just plus stg73mn. The BBA noted that net mortgage lending had risen by 0.4% in the year to October. It said that unsecured borrowing had contracted by 2.7% over the year to October. Within that, credit card lending rose by 5.1%, with a contraction of 8.2% in personal loans and overdrafts driving the overall decline. –London Bureau; Tel: +4420 7862 7492; email: dthomas@marketnews.com [TOPICS: MABDS$,M$B$$$]

Draghi: ECB reacted to crisis proactively Posted: 23 Nov 2012 01:44 AM PST Clever old sticks ECB averted a credit crunch 2012 has been an intense year for the ECB ECB ensures price stability in both directions ECB has shown resolve, foresight (a little humility wouldn’t go amiss Mario) OMT, ESM has helped to calm markets Return of confidence in euro area justified ECB stands ready to implement OMT when required Governments must followthrough on reforms Single supervisor needs to be implemented well Need to take all the time needed for supervision Probably pragmatic that ECB be single supervisor ECB has competence to be single supervisor

Ifo: Germany Business Morale Beats Expectations In November Posted: 23 Nov 2012 01:40 AM PST Nov MNI analysts survey Oct Sep median range ———————————————————————— Business sentiment: 101.4 99.5 87.0 – 100.0 100.0 101.4 Current conditions 108.1 106.0 98.5 – 107.6 107.2 110.2 Six-month outlook: 95.2 93.0 91.9 – 105.0 93.2 93.2 – FRANKFURT (MNI) – Business morale in Germany defied expectations of a renewed downturn in November as both the assessment of current conditions and business expectations for the coming six months recovered, the Ifo institute reported on Friday. A vast majority of analysts had expected a further deterioration in sentiment, with the only the most optimistic calling for no change. The upside surprise pushed up the euro to the highest level since November 2. “The German economy is holding up in the face of the euro crisis,” Ifo President Hans-Werner Sinn said in a press release. “Companies expressed slightly greater satisfaction with their current business situation. They were also far less pessimistic about future business developments.” In manufacturing, the business climate index rose to -6.5 from -7.2 in October, following a six-month decline with the recovery driven by both the assessment of current conditions and the outlook. “Export expectations were positive for the first time in three months,” Ifo said. The business climate index in wholesaling and retailing increased sharply to 4.9 from -3.2 and to -0.6 from -5.8 respectively. Wholesalers were more optimistic about both the present and the future while the recovery in retailing was driven by a expectations of a significant pick up in the future. In construction, the business climate recovered to -7.5 from -11.8. Only the services sector bucked the trend, dropping to 8.5 in November from 9.1 in October. “Assessments of the current business situation remained good. However, assessments of the business outlook were slightly more pessimistic than last month,” Ifo said. While the 0.2% rise in 3Q GDP was some stronger than generally expected, forward-looking indicators point to a setback in 4Q. Industrial orders hit multi-year lows in September, in large part due to a 9.6% drop in demand from within the Eurozone. The November PMI poll showed manufacturing new orders losing further ground, though stronger Chinese demand help reduce the rate of decline to the slowest pace since March. “The picture emerging from November’s survey is that the German economy will end the year with a whimper rather than a bang, as troubles in the Eurozone continue to weigh on domestic business and consumer confidence,” said Markit senior economist Tim Moore. The Bundesbank also warned that Germany was increasingly vulnerable to the economic problems of its neighbours. “The economic outlook is currently based on a intermingled overall picture that by all expectations will continue to weaken through the end of the year,” the central bank said in its latest bulletin. The Economics Ministry agreed, forecasting a “temporary growth dent” over the winter half-year: “The noticeable slowing of global growth, especially the economic weakness in some countries of the Eurozone, is increasingly dampening economic developments in Germany,” the ministry said this week. – Frankfurt bureau: +49 69 720 142; email: frankfurt@mni-news.com – [TOPICS: M$G$$$,MT$$$$,M$X$$$,M$XDS$,MAGDS$,MTABLE]

BBK Lautenschlaeger: U.S. Banks In The EU Could Feel The Heat Posted: 23 Nov 2012 01:40 AM PST –W/Out Basel III,Will Need “Equivalent Supervision” Of EU Subsidiaries FRANKFURT (MNI) – Bundesbank Vice President Sabine Lautenschlaeger said Friday she still expected the United States to implement Basel III banking rules, but she warned that EU subsidiaries of US banks would likely face higher supervision standards if the U.S. failed to approve the rules. Speaking on the sidelines of the European Banking Congress here, Lautenschlaeger said, “I still expect that the US will enact Basel III.” If the U.S. did not meet the Basel III standards, “then we must of course consider what to do with the US institutions in the European Union.” Lautenschlaeger said there would have to be an “equivalent supervision system” for all banks in the European Union. U.S. authorities earlier this month said that they would not meet the previously agreed deadline of phasing in Basel III rules as of January 2013. U.S. Federal Deposit Insurance Corporation vice chairman Thomas Hoenig has since said “Basel III won’t make the banking system safer; I would even say it makes it more vulnerable.” – Frankfurt bureau: +49 69 720 142; email: frankfurt@mni-news.com [TOPICS: M$X$$$,M$$EC$,MGX$$$,MT$$$$,M$$CR$,M$G$$$]

UK DATA: BBA Oct mortgage approvals 33,039 vs 31,544. Posted: 23 Nov 2012 01:40 AM PST UK DATA: BBA Oct mortgage approvals 33,039 vs 31,544 Sep - BBA Oct sa remortgage approvals 20,112 vs 19,929 Sep - BBA Oct net change in mortgage amount outstanding +stg73mn

UK Oct Mortgage approvals rise to 37,129 from 29,975 in Sept Posted: 23 Nov 2012 01:33 AM PST Thats’s a 6% rise y/y… Remortgaging rose to 22,204 from 18,410 in Sept Net lending + £127 mln in Oct , after +322 mln rise in Sept

German parliament rejects treaty on undeclared Swiss bank accounts Posted: 23 Nov 2012 01:21 AM PST Bloomberg reporting

Ifo economist: Exports of German firms to Asia and USA are going very well, industrial orders are stabilising Posted: 23 Nov 2012 01:16 AM PST Retailers are considerably more optimistic ahead of Christmas in contrast to last year Companies are continuing to hold back on investments due to uncertainty over debt crisis Q4 GDP will be even weaker than it was in Q3, COULD POSSIBLY SLIP INTO NEGATIVE TERRITORY

Update: S&P Affirms France’s AA+/A-1+ Rating;Outlook Negative Posted: 23 Nov 2012 01:10 AM PST –Adds Comments By French Finance Minister Moscovici Welcoming Decision PARIS (MNI) – Standard & Poor’s Rating Services Friday affirmed France’s sovereign rating at AA+/A-1+, while keeping its negative outlook, which means there is a one in three chance that it will downgrade France in 2013. S&P cited France’s commitment to fiscal and structural reform, but noted concerns about consumption, unemployment, weak wages and sluggish investment. It predicted the French government would miss its 3.0%-of-GDP deficit target for 2013 by 0.5 percentage point. The move comes after Moody’s earlier this week downgraded France by one notch, in what was essentially a catch-up maneuver since S&P had already downgraded Paris earlier this year. French Finance Minister Pierre Moscovici welcomed the S&P decision to uphold France’s rating. “As Standard & Poor’s acknowledges, France is a solid country with a rich, diversified and resilient economy,” Moscovici said in a written statement. “French debt is among the most liquid and safest in the Eurozone, currently benefiting from historically low rates, which is proof of investors’ confidence.” Today’s statement by S&P explaining its decision is below: “Standard & Poor’s Ratings Services today affirmed its unsolicited long- and short-term sovereign credit ratings on the Republic of France at ‘AA+/A-1+’. The outlook is negative. Our transfer and convertibility (T&C) assessment for France, as for all European Economic and Monetary Union (eurozone) members, is ‘AAA’. The affirmation reflects our opinion that the French government remains committed to budgetary and structural reforms that would build on the measures it has proposed so far and improve the country’s growth potential. In particular, in the face of uncertain economic growth prospects, the government has already taken steps toward restoring competitiveness, by announcing the National Compact for Growth, Competitiveness and Employment this month, and toward compliance with its medium-term budgetary targets. Our baseline expectation is that the government will press ahead with further important structural reforms, despite opposition from vested interests which benefit from long-entrenched entitlements. Substantial reforms would underpin the government’s fiscal consolidation strategy, in our view, and improve economic growth prospects. After flat growth this year, we believe that the French economy will grow by 0.4% in real terms in 2013, characterized by: -The government’s ongoing implementation of its consolidation plan, alongside fiscal tightening in France’s key eurozone trading partners; – Wavering consumption levels, rising unemployment, and decelerating wages; – Sluggish investment reflecting among other factors challenged corporate profitability; and – An uncertain outlook for external demand. We believe the following factors have contributed to a significant erosion of the French economy’s cost- and non-cost competitiveness: – Structural rigidities in the labor market; – Relatively restrained competition in some services sectors; and – The overall high tax burden. We believe that the reform measures proposed so far–such as introducing corporate tax credits on firms’ payrolls–are useful but insufficient to significantly unlock economic growth potential. In our view, business growth is unlikely to improve substantially without deeper labor and services-sector reforms–which would reduce barriers to entry and introduce competition to regulated professions–as well as cut back red tape for businesses. Our ratings affirmation is based on our view that additional reforms will be implemented in the near term, reflecting the government’s willingness to build on the benefits of measures proposed so far to unlock France’s growth potential. In our opinion, labor and service-sector reforms would be positive for competitiveness, economic growth, and, in turn, sovereign creditworthiness. They would likely reduce unemployment over the medium term and relax existing structural rigidities such as the relative insensitivity of wages to the economic cycle, the duality of open-ended and fixed-term contracts, and legislation related to hiring and firing. We believe such reforms would be key to improving employment incentives for both employees and employers. Since it took office in May 2012, the government has asserted its commitment to deficit targets by adopting revenue- and spending-side measures as well as strengthening the fiscal framework. It has detailed a multiannual public finance planning act and has established a high council for public finances, among other steps. France’s tax burden remains very high relative to other advanced economies at more than 46% of GDP over 2012-2015 (with general government revenue at around 53% of GDP), while we project general government spending will stay above 56% of GDP over the same period, the highest in the eurozone. We forecast a general government deficit of 4.5% of GDP in 2012 in line with the government’s target, and 3.5% in 2013 (2013 government target: 3.0%). Our projection of higher-than-targeted general government deficit for 2013 reflects our forecast for weaker GDP growth. Consequently, we estimate gross debt–excluding the European Financial Stability Facility guarantees–to exceed 91% of GDP in 2013 (with net general government debt at around 85% of GDP), and to stabilize at around that level thereafter (see “S&P Clarifies Its Approach To Accounting For EFSF Liabilities When Rating The Sovereign Guarantors”, published Nov. 2, 2011). We view France as a sovereign benefitting from a wealthy, highly diversified, and resilient economy with a skilled and productive labor force and a high rate of savings. The outlook on the long-term rating on France is negative, indicating that we believe that there is at least a one-in-three chance that we could lower the rating during 2013 if we saw that: – Economic growth prospects deteriorate further or the authorities fail to significantly overhaul the labor market and services sectors; or – France’s general government deficit were to remain close to current levels, leading to a gradual increase in the net general government debt to more than 100% of GDP; or – Heightened financing and economic risks in the eurozone were to significantly increase France’s contingent liabilities, or materially worsen external financing conditions. Conversely, the outlook could return to stable if the authorities can reduce the general government deficit such that the public debt ratio stabilizes in the next two-to-three years. Substantial structural reforms that improve economic competitiveness and support growth could also help stabilize the ratings.” –Paris newsroom, +331-42-71-55-40; bwolfson@mni-news.com [TOPICS: M$F$$$,M$X$$$,M$$CR$,MGX$$$,MT$$$$]

ITALY DATA: Sept seas adj. nominal retail sales:….. Posted: 23 Nov 2012 01:10 AM PST ITALY DATA: Sept seas adj. nominal retail sales: +0.1% m/m, -1.7% y/y –July-September 3-month/3 month moving average +0.1% –September sa food sales +0.2% m/m, -0.6% y/y –September sa non-food sales 0.0% m/m, -2.4% y/y –Italy’s NIC consumer price index was flat m/m, +3.2% y/y in September

German November Ifo business climate 101.4 Posted: 23 Nov 2012 01:03 AM PST Whoopee, demonstrably better than Reuter’s median forecast of 99.5. Current conditions index 108.1 also demonstrably better than Reuter’s median forecast of 106.3. EUR/USD rallies back to 1.2900 on data.

Italian Sept sa retail sales +0.1%m/m , -1.7% y/y (unadj) Posted: 23 Nov 2012 01:01 AM PST from flat m/m reading in August

BUBA’s Lautenschlaeger: Still expects the US to implement Basle 111 Posted: 23 Nov 2012 12:51 AM PST … If not there could be stricter supervision of US banks operating in Europe Reuters reporting

Don’t mess with the Chinese government… Posted: 23 Nov 2012 12:41 AM PST Look what happens when you refuse to move house….  unless of course you like to  ’car watch’

S&P Affirms France’s AA+/A-1+ Rating; Outlook Still Negative Posted: 23 Nov 2012 12:40 AM PST PARIS (MNI) – Standard & Poor’s Rating Services Friday affirmed France’s sovereign rating at AA+/A-1+, while keeping its negative outlook, which means there is a one in three chance that it will downgrade France in 2013. S&P cited France’s commitment to fiscal and structural reform, but noted concerns about consumption, unemployment, weak wages and sluggish investment. It predicted the French government would miss its 3.0%-of-GDP deficit target for 2013 by 0.5 percentage point. The move comes after Moody’s earlier this week downgraded France by one notch, in what was essentially a catch-up maneuver since S&P had already downgraded Paris earlier this year. Today’s S&P statement is below: “Standard & Poor’s Ratings Services today affirmed its unsolicited long- and short-term sovereign credit ratings on the Republic of France at ‘AA+/A-1+’. The outlook is negative. Our transfer and convertibility (T&C) assessment for France, as for all European Economic and Monetary Union (eurozone) members, is ‘AAA’. The affirmation reflects our opinion that the French government remains committed to budgetary and structural reforms that would build on the measures it has proposed so far and improve the country’s growth potential. In particular, in the face of uncertain economic growth prospects, the government has already taken steps toward restoring competitiveness, by announcing the National Compact for Growth, Competitiveness and Employment this month, and toward compliance with its medium-term budgetary targets. Our baseline expectation is that the government will press ahead with further important structural reforms, despite opposition from vested interests which benefit from long-entrenched entitlements. Substantial reforms would underpin the government’s fiscal consolidation strategy, in our view, and improve economic growth prospects. After flat growth this year, we believe that the French economy will grow by 0.4% in real terms in 2013, characterized by: -The government’s ongoing implementation of its consolidation plan, alongside fiscal tightening in France’s key eurozone trading partners; – Wavering consumption levels, rising unemployment, and decelerating wages; – Sluggish investment reflecting among other factors challenged corporate profitability; and – An uncertain outlook for external demand. We believe the following factors have contributed to a significant erosion of the French economy’s cost- and non-cost competitiveness: – Structural rigidities in the labor market; – Relatively restrained competition in some services sectors; and – The overall high tax burden. We believe that the reform measures proposed so far–such as introducing corporate tax credits on firms’ payrolls–are useful but insufficient to significantly unlock economic growth potential. In our view, business growth is unlikely to improve substantially without deeper labor and services-sector reforms–which would reduce barriers to entry and introduce competition to regulated professions–as well as cut back red tape for businesses. Our ratings affirmation is based on our view that additional reforms will be implemented in the near term, reflecting the government’s willingness to build on the benefits of measures proposed so far to unlock France’s growth potential. In our opinion, labor and service-sector reforms would be positive for competitiveness, economic growth, and, in turn, sovereign creditworthiness. They would likely reduce unemployment over the medium term and relax existing structural rigidities such as the relative insensitivity of wages to the economic cycle, the duality of open-ended and fixed-term contracts, and legislation related to hiring and firing. We believe such reforms would be key to improving employment incentives for both employees and employers. Since it took office in May 2012, the government has asserted its commitment to deficit targets by adopting revenue- and spending-side measures as well as strengthening the fiscal framework. It has detailed a multiannual public finance planning act and has established a high council for public finances, among other steps. France’s tax burden remains very high relative to other advanced economies at more than 46% of GDP over 2012-2015 (with general government revenue at around 53% of GDP), while we project general government spending will stay above 56% of GDP over the same period, the highest in the eurozone. We forecast a general government deficit of 4.5% of GDP in 2012 in line with the government’s target, and 3.5% in 2013 (2013 government target: 3.0%). Our projection of higher-than-targeted general government deficit for 2013 reflects our forecast for weaker GDP growth. Consequently, we estimate gross debt–excluding the European Financial Stability Facility guarantees–to exceed 91% of GDP in 2013 (with net general government debt at around 85% of GDP), and to stabilize at around that level thereafter (see “S&P Clarifies Its Approach To Accounting For EFSF Liabilities When Rating The Sovereign Guarantors”, published Nov. 2, 2011). We view France as a sovereign benefitting from a wealthy, highly diversified, and resilient economy with a skilled and productive labor force and a high rate of savings. The outlook on the long-term rating on France is negative, indicating that we believe that there is at least a one-in-three chance that we could lower the rating during 2013 if we saw that: – Economic growth prospects deteriorate further or the authorities fail to significantly overhaul the labor market and services sectors; or – France’s general government deficit were to remain close to current levels, leading to a gradual increase in the net general government debt to more than 100% of GDP; or – Heightened financing and economic risks in the eurozone were to significantly increase France’s contingent liabilities, or materially worsen external financing conditions. Conversely, the outlook could return to stable if the authorities can reduce the general government deficit such that the public debt ratio stabilizes in the next two-to-three years. Substantial structural reforms that improve economic competitiveness and support growth could also help stabilize the ratings.” –Paris newsroom, +331-42-71-55-40; bwolfson@mni-news.com [TOPICS: M$F$$$,M$X$$$,M$$CR$,MGX$$$,MT$$$$]

Spanish October PPI -0.1% m/m,+3.5 % y/y Posted: 23 Nov 2012 12:01 AM PST from 3.8% y/y in September

EUR/USD poll-time!! Posted: 22 Nov 2012 11:53 PM PST With 1.2900 finally toast, time for another poll. What’ll we see first 1.2800 or 1.3000? Reason/s for choice always welcome, but not obligatory.

FRANCE DATA: November mfg sentiment 88 vs October 85. Posted: 22 Nov 2012 11:50 PM PST FRANCE DATA: November mfg sentiment 88 vs October 85 – Above expected; MNI analysts survey median forecast 87 – Execs’ own-company outlook -7 vs October -9 (-8) – Sector production outlook -40 vs October -55 (-56) – See MNI’s Mainwire for more details

French manufacturing industry morale rises to 88 in November Posted: 22 Nov 2012 11:49 PM PST Up from unrevised 85 in October and stronger than Reuter’s median forecast of 86.

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