The calm that has descended upon euro-zone markets could be tested in the next few weeks, as Italy heads for the polls and Spain prepares to reveal the extent of its budget deficit, while economic data will be closely scanned for evidence that the region is emerging--or struggling to emerge--from recession.
According to opinion polls, a center-left coalition is likely to win Italy's elections but may still have to forge an alliance with Mario Monti , the outgoing technocrat prime minister, to form a government.
In Spain , the focus is on the state of the public sector's finances, given the belated regional overruns that wrecked Spain's deficit-cutting efforts in 2011. Spain is aiming to narrow its 2012 budget gap to 6.3% of gross domestic product, although a figure closer to 7% is expected.
Banks will also get an opportunity to begin paying back some of the second batch of emergency, cheap loans doled out by the European Central Bank in February 2012 , giving markets more of a sense of the degree to which euro-zone monetary conditions have begun to tighten ahead of the ECB's next meeting, where the drag on growth from a strong euro will again come under scrutiny.
This is the known worry list:
-- Monday, Feb. 11 : French December industrial production. Euro-zone finance ministers meeting.
-- Tuesday, Feb. 12 : Spanish and Italian T-bill auctions. Greek T-bill auction. European Union finance ministers meeting.
-- Wednesday, Feb. 13 : Italian and German bond auctions.
-- Thursday, Feb. 14 : Euro-zone preliminary fourth-quarter GDP data.
--Friday-Saturday, Feb. 15-16 : G-20 finance ministers meeting in Moscow .
-- Sunday, Feb. 17 : Cypriot presidential election.
-- Tuesday, Feb. 19 : German ZEW February economic-sentiment indicator. Spanish T-bill auction. Greek T-bill auction (to be confirmed).
-- Wednesday, Feb. 20 : German bond auction. Portuguese T-bill auction.
-- Thursday, Feb. 21 : Spanish and French bond auctions. Flash euro-zone February PMI data.
-- Friday, Feb. 22 : German Ifo February business-climate index. First weekly repayment announcement of LTRO II money.
--Sunday-Monday, Feb. 24-25 : Italian general elections.
-- Monday, Feb. 25 : Italian bond auction.
-- Tuesday, Feb. 26 : Italian T-bill auction. Spanish 2012 budget-deficit data ( to be confirmed).
-- Wednesday, Feb. 27 : Euro-zone November M3. Italian bond auction.
-- Thursday, Feb. 28 : Final Spain fourth-quarter GDP data. German February labor data.
-- Friday, March 1 : Final euro-zone February manufacturing PMI data.
-- Monday, March 4 : Euro-zone finance ministers meeting.
-- Tuesday, March 5 : European Union finance ministers meeting. Final euro-zone February services PMI data. ESM T-bill auction. Greek T-bill auction (to be confirmed).
-- Wednesday, March 6 : German bond auction. Euro-zone revised fourth-quarter domestic-product data.
-- Thursday, March 7 : Spanish and French bond auctions. ECB interest-rate decision and press conference. German December manufacturing orders.
-- Monday, March 11 : Portugal fourth-quarter GDP data.
-- Tuesday, March 12 : Italian and Spanish T-bill auctions.
-- Wednesday, March 13 : German and Italian bond auctions.
-- Thursday, March 14 : Irish T-bill auction (to be confirmed).
-- Tuesday, March 19 : Spanish and ESM T-bill auctions. Greek T-bill auction (to be confirmed).
-- Wednesday, March 20 : Portugal T-bill auction
-- Thursday, March 21 : Spanish and French bond auctions.
-- Monday, March 25 : Italian bond auction.
-- Tuesday, March 26 : Italian T-bill auction.
-- Wednesday, March 27 : Italian bond auction.
AI
