Brussels Edition: Caught Between Crises

(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

When Ursula von der Leyen imagined marking her first 100 days in office, she probably expected to highlight her Green Deal, proposals for regulating AI or the imminent industrial strategy plan. Instead, as she takes the floor today to talk about the past three months, European markets will probably be crashing. Firstly, there’s the coronavirus outbreak overwhelming governments across the world. And secondly, tensions with Turkey are at a new high after President Recep Tayyip Erdogan threatened to let migrants flow to the EU. Erdogan will be in Brussels today to meet the EU’s top brass — but given the bloc’s criticism of his tactics and resistance to doling out more cash, it’s unclear what, if anything, can be agreed.

What’s Happening

Pricing a Lockdown | Italy’s abrupt lockdown measures will be tested by the reopening of financial markets today as investors give their vote on whether the new restrictions have struck the right balance between containment and avoiding excessive economic pain.

Lagarde’s Dilemma | The first crisis during Christine Lagarde’s ECB tenure will force her to decide this week whether to fire one of the few bullets she has left. A cut of at least 10 basis points would add the ECB to the list of central banks using rates to shield their economies. But it could also backfire by doing little to address the specific impact of the coronavirus and reducing already limited policy space.

Green List | The EU’s influential expert group on sustainable finance will present its final report on the list of green activities known as taxonomy. Focus then shifts to the European Commission, which will have to turn the document into a legal act by year-end and make some difficult decisions along the way — like whether it should follow the panel’s advice and shut the door on nuclear power.

Polish Spat | The EU’s top court will hold a hearing today as part of a bid by the EU Commission to suspend Poland’s disciplinary regime for judges, which regulators have said undermines democracy. A decision could come within days as Poland is on the verge of having its judiciary effectively leave the EU’s interconnected legal system, meaning decisions won’t be respected by its EU partners.

In Case You Missed It

Virus Fight | The coronavirus outbreak continued to engulf the globe over the weekend, with more than 105,000 cases reported in about half of the world’s countries. Governments joined Italy in taking an array of measures to contain and fight the virus, with Israel planning to deploy the military to help.

German Aid | The government of Chancellor Angela Merkel will invest an additional 12.4 billion euros between 2021 and 2024 to help companies and workers hit by coronavirus fallout. After more than seven hours of talks Sunday night, Merkel’s coalition also loosened rules for short-term work compensation, making it easier for big firms heavily affected by the virus, like Deutsche Lufthansa AG, to apply for aid.

Green Power | As politicians across Europe wrestle with the decline of traditional parties and the challenges of climate change, Green movements are emerging as serious contenders for government. With Germany’s ruling CDU party in the midst of a power struggle, the Greens are presented with an historic opportunity to define Europe’s biggest economy in the post-Merkel era.

Mind the Gap | The U.K. is the biggest country yet to zoom in on the explosive topic of the pay gap between women and men. For a third year, employers with 250 or more workers in Britain are reporting “raw” wage data via mandatory annual disclosures with a one-year time lag. Here’s what the numbers show.

No Rules | British Finance Minister Rishi Sunak signaled the U.K.’s fiscal rules could be ditched as he prepares a massive package of measures to tackle the coronavirus crisis. While the budget was meant to be the landmark moment Boris Johnson’s new government unveiled its vision, Sunak has been forced to re-write his statement in the face of the virus outbreak.

Chart of the Day

Christine Lagarde’s appointment to lead the ECB was a landmark event in improving gender diversity in economic policy making, but global central banks still have a long way to go. Lagarde’s leadership contrasts with the all-male eurosystem of national central bank governors, a report from the Official Monetary and Financial Institutions Forum said. While Europe is the best-performing region when it comes to diversity of central banks, only 14 institutions are female-led across the globe, representing less than a third of the global economy.

Today’s Agenda

All times CET.

• 11 a.m. Press conference by Commission President von der Leyen marking her first 100 days in office

• 12 p.m. Press conference by EU foreign policy chief Borrell and Commissioner Urpilainen on Africa strategy

• 6 p.m. Turkey’s Erdogan meets EU’s Michel, von der Leyen in Brussels

• EU lawmakers discuss first legislative proposal of the Green Deal with Commission Vice President Timmermans

• EU Commission presents updated expert group report on the green finance taxonomy

•  EU court weighs Commission request to suspend Poland’s disciplinary regime for judges until there’s a ruling

• EU Parliament Plenary begins in Brussels

• Germany’s Merkel, Greece’s Mitsotakis speak at German-Greek business forum in Berlin

• MH17 trial begins in Amsterdam

--With assistance from Alexander Weber and Nikos Chrysoloras.

To contact the editor responsible for this story: Heather Harris at hharris5@bloomberg.net, Iain Rogers

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