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EU CRISIS ROAD MAP – KEY MILESTONES AHEAD

By Dow Jones FX Trader

The much-trumpeted deal struck in Brussels to save the euro is coming under intense scrutiny, with political and legal challenges to the agreement already taking shape, especially from Europe’s center-left.

The deal may need parliamentary approvals in some countries while others are already raising concerns. Francois Hollande, the Socialist Party candidate who is currently the clear leader in opinion polls for the French presidential elections next year, said he would seek to renegotiate the deal if elected. Meanwhile, poorer Eastern European nations like Polands and the Czech Republic are fretting that the deal may be too expensive for them, if they are to increase contributions to the International Monetary Fund. EU leaders Friday agreed to advance up to EUR200 billion to the IMF to help fund its backstop mechanisms, as part of a broader deal that called for tighter fiscal discipline across the euro zone and most of the EU.

The lower house of parliament, or Bundestag, will also have to deal with the decision to provide more funds to the IMF, a spokesman for German Chancellor Angela Merkel said, though he didn’t specify whether the Bundestag will only be informed of the measure, or will have to vote on it.

It remains to be seen if the deal agreed upon Friday will convince the European Central Bank to intervene more forcefully in the sovereign bond market. ECB President Mario Draghi Thursday sent a very clear message that he wouldn’t do anything of the sort, dashing market expectations that the ECB would step up its bond purchases once a convincing political solution to the crisis was in place.

This is the known worry list:

–Tuesday: First meeting of new Spanish parliament after election. Spanish, Greek and Belgian T-bill auctions. German ZEW economic sentiment indicator for December.

–Wednesday: Italian bond auction. ECB 7-day dollar tender. EU industrial production data for October.

–Thursday: Spanish bond auction. Euro-zone-wide manufacturing and services sector PMI data for December.

–Monday, Dec. 19: EUR1.22 billion of Greek debt falls due. ECB’s weekly bond-purchase data. French T-Bill auction.

–Tuesday, Dec. 20: Spanish and Greek T-bill auctions. Announcement by ECB of 13-month long-term refinancing operation. German December Ifo business climate index.

–Wednesday, Dec. 21: Portuguese T-bill auction. Swearing in of Mariano Rajoy as Spanish prime minister and disclosure of new cabinet expected around this time. ECB 7-day dollar tender.

–Thursday, Dec. 22: EUR980 million of Greek debt falls due.

–Friday, Dec. 23: Potential first cabinet meeting of new Spanish government and approval of first economic measures, possibly including an emergency budget decree ahead of a formal 2012 budget.

–Wednesday, Dec. 28: Italian T-bill, zero-coupon bond auction.

–Thursday, Dec. 29: EUR5.23 billion of Greek debt falls due. Italian bond auction.

–Friday, Dec. 30: EUR715 million of Greek debt falls due. First meeting of new Spanish PM’s cabinet and first batch of emergency austerity measures expected.

–Monday, Jan. 2: Euro zone December manufacturing PMI.

–Wednesday, Jan. 4: Euro zone December services PMI.

–Thursday, Jan. 12: ECB interest rate statement and press conference. Spain auctions new 3-year bond.

–Monday, Jan. 23: Euro zone January flash PMI.

–Wednesday, Jan. 25: Preliminary data on Spain’s government annual budget deficit expected around this time. German January Ifo business climate index.

–Tuesday, Jan. 31: Ireland’s troika of lenders releases its latest quarterly review of the country’s bailout. Greece aims to conclude talks detailing new EUR130 billion loan deal, debt exchange program with private sector creditors by this date.

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