Draghi's call for action could well fall on deaf ears
Published 18/07/2016 | 02:30
This week the European Central Bank will hold its first scheduled monetary policy meeting since the UK voted to leave the European Union.
ECB President Mario Draghi is likely to plead for governments to do more to boost the eurozone's economy in the coming week as the fallout of Britain's vote and weaker global growth threaten the bloc's fragile recovery.
A reiteration of Draghi's long-standing call on governments to spend more where possible and speed up growth-boosting reforms may well fall on deaf ears. The only country with significant fiscal firepower, Germany, is reluctant to give up its budget surplus and has resisted any attempt to pool more money at the European level in the absence of greater power-sharing.
The ECB is not expected to change its monetary stance on Thursday, its last meeting before an eight-week summer break.
On Tuesday the International Monetary Fund will release its latest global macroeconomic forecasts. In the US, markets will get a double dose of housing news with figures on previously owned home sales and new construction starts in June. While low borrowing costs are sustaining demand, higher prices are limiting the speed at which residential real estate can progress.
US Republicans also meet to nominate their choice for president at the convention in Cleveland. Donald Trump is the party's presumptive nominee.
Bank of America, Goldman Sachs and Morgan Stanley announce earnings this week, along with General Motors, Daimler, Microsoft, Novartis and Netflix.