One of the simplest ways to measure macroeconomic risk is to look at the twin deficit, defined as the sum of current account and budget deficit as a percentage of GDP. Recent blow-ups like Iceland and Greece both scored highest on these fronts. Looking at twin deficits gives a reliable indicator of the individual risk profile for a country in the context of a sudden spike in international funding costs or deleveraging. On the latest reading, New Zealand and Turkey stand out (apart from the usual suspects, ie eurozone periphery and South Africa), with twin deficits well in excess of 10% for both economies.

One of the world’s biggest commodity producers, BHP Billiton, recently got a lot of attention by suggesting that the so far insatiable Chinese demand for commodities may have come to an end. The argument is simple enough: the rate of growth in China is slowing. However, the implications for commodity exporters, such as Australia, who have invested dizzying sums of money in expanding capacity to reflect an ever higher increase in Chinese commodity hunger, may be very big indeed.

Following the pattern we have identified in other countries in the region, Ukraine is once more getting itself into a deeper and deeper mess

Looking beyond cyclical variations, a lingering concern is the structural undercurrents of a continuing falling labour force participation rate and a high long-term unemployment rate. Both paint a rather bleakpicture of the US labour market.

UK inflation has been falling, driven mainly by a fall in consumer demand, and last year’s VAT increase falling out of the year-on-year comparisons. Looking under the bonnet, however, reveals a disconnect between inflation of ‘necessary’ and ‘discretionary’ goods.

Greece is in default and Ireland and Portugal are in limbo with the market pricing in a Greek outcome in both economies. However, the situation has changed in Spain and Italy and on this measure alone, the ECB’s LTRO has been successful.

Simon Ward at Money Moves Markets updates us on the latest monetary aggregates from the eurozone and despite strong global growth in excess liquidity and central bank expansion, money growth remains weak in Europe. Going out of 2011, 6 month…

The market has recently taken relief from the decision by China to lower the reserve requirement ratio (RRR) as well as the signal that it will be the first of a series of cuts. The real story however is that the shift comes in response to a sharp slowdown in both domestic and external demand in the first quarter of 2012 and thus it seems that investors may have taken too much comfort in the strong Q4-11 GDP print.

See original article at http://www.cnbc.com/id/46461291 The second Greek bailout deal was finally clinched in the early hours of Tuesday morning. European markets and the euro were initially expected to rally after the market open – but a troika report leaked…

Variant Perception’s Jonathan Tepper will be appearing as a Guest Host on Squawk Box Europe, tomorrow (Tuesday 21st February) from 7am – 9am GMT.

[Updated] See our Press page for part of the interview.