Brussels Edition: The Center Holds

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

The European Parliament will release its penultimate forecasts this morning for elections in May, with polls so far showing that populist parties will make sizable gains without causing a fundamental political reordering. The surveys to date — based on an aggregation of national polls — have pointed to a more fragmented EU assembly that may have more trouble mustering majorities for European legislation and top-level appointments. Still, to the disappointment of the likes of Nigel Farage and Steve Bannon, the broad center has been projected to hold. 

What’s Happening

Third Time Lucky? | It’s Theresa May’s last chance to get her deal through U.K. parliament if she’s to avoid a no-deal cliff edge on April 12. After splitting the withdrawal agreement from the political declaration to get another vote on the table today, May still faces seemingly impossible odds and could well be back in Brussels soon enough to seek a longer extension. Meanwhile, the EU is already looking one step beyond a no-deal exit.

Week Ahead | The EU Commission will publish a communication on the rule of law next week, in which Hungary, Poland and Romania may get dishonorable mentions. On Thursday, NATO foreign ministers will celebrate the alliance’s 70th birthday in Washington with complaints from the U.S. administration about meager defense spending, while Greece and the euro-area budget are going to dominate the meeting of EU finance ministers in Bucharest on Friday.

Ukrainian Ballot | Ukrainians will pick their next president on Sunday, with polls showing that Volodymyr Zelenskiy, a television comic with no political experience, is the favorite to win the first round of voting. What is not funny at all is that after two uprisings, perpetual promises to end corruption and only a distant prospect of EU membership, frustration is consuming the country.

Erdogan Tested | The strategy of Recep Tayyip Erdogan to clash with markets and his unorthodox economic theories will be put to the test this Sunday, when Turkey’s local elections are likely to show that the political winds are starting to shift against him. Hitching development to consumer spending and urban infrastructure projects has destabilized the country’s food supply and cost many in the countryside their livelihoods, Cagan Koc reports.

In Case You Missed It

Swedbank Swirls | Swedbank fired its chief executive offiicer yesterday amid allegations the bank was used to launder billions of dollars in Russian money on her watch. The dirty-money saga engulfing Europe’s financial system seems to be spinning out of control. Among those worried is euro-area hopeful Bulgaria.

German Ban | Chancellor Angela Merkel’s government extended a weapons embargo on Saudi Arabia for six months, resolving a dispute in the ruling coalition over European defense projects. The halt to weapons deliveries will run until Sept. 30, but exceptions would be made for joint export projects until the end of the year.

Trading Pleas | The world’s biggest banks and money managers are pleading with the EU to reverse a policy that would restrict London trading of blue-chip shares in a no-deal scenario. The measure would require EU investment firms to trade certain shares within the bloc and not in London. The industry says such a move “will have a negative impact on European investors, who will suffer from an increasingly fragmented trading landscape.”

A Good Year | Next week, global wine attention turns to Bordeaux, as thousands of merchants and journalists descend on the region for the annual spring ritual, en primeur. The big question, always, is how good are the wines? Elin McCoy has the answer. 

Chart of the Day

Growth is slowing in Europe and the world, but is a recession coming? That’s a big question bothering economists these days. And judging from their past record, they’re unlikely to give you the right answer. The reason may partly lie in groupthink, Simon Kennedy and Peter Coy reckon: Professional forecasters feel safer in a crowd rather than sticking their necks out with a recession call.

Today’s Agenda

All times CET.

• 9:30 a.m. The European Parliament publishes a third set of projections of election results in May
• 3:30 p.m. U.K. House of Commons votes on Withdrawal Agreement struck with the EU
• EU competition chief Margrethe Vestager participates in the American Bar Association Enforcers’ Roundtable at the Antitrust Law 2019 Spring Meeting in Washington, D.C.
• EU ambassadors in Brussels to discuss overhaul of social-security rules, allowing EU migrants to export their unemployment benefits from their host country for six months after returning to their home country

--With assistance from Viktoria Dendrinou and Ian Wishart.

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

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