Monday, February 13

TESTY POLITICIANS: ITALY’S RULING PARTY

Leaders of Italy’s ruling Democratic Party (PD) will meet on Monday to discuss election strategy amid rumours of an internal rift.

Keen to get back into power, former Prime Minister Matteo Renzi had stated his preference for fresh elections to be called ahead of the 2018 deadline – perhaps as early as June. But another former PM, Massimo D’Alema, has threatened to break away from the PD if early elections are called, taking the influential left wing of the party with him. A recent poll suggested that D’Alema’s exit would reduce the party’s support by around half, prompting Mr Renzi to back away from his position.

Meanwhile, Italians are increasingly dissatisfied with a stagnating economy, political infighting and high levels of irregular immigration, leading many to abandon the centre-left party in favour of the populist Five Star Movement. Polling data suggests the Movement is currently Italy’s most popular party, although would find it difficult to forge a ruling coalition if elections were called today.

The PD must tread carefully if it wants to retain power; a split would be devastating, both for the party and possibly for Europe.

Go deeper: Italian populists threaten the EU

TRUDEAU GETS THE TRUMP TREATMENT

Canada’s charismatic leader will meet Donald Trump at the White House on Monday. President Trump has gotten to know a spate of foreign leaders over the past two weeks with mixed success. Mr Trudeau will be hoping for a warm reception but will be wary of upsetting America’s temperamental new leader for fear of receiving the same harsh treatment as Australian Prime Minister Malcolm Turnbull.

Trade issues will be high on the agenda. Trump has vowed to renegotiate NAFTA, but senior members of his administration have suggested Canada won’t be targeted. This is good news for Canadians – they sell 75% of their exports to America – and Trudeau, whose already-falling approval ratings would be harmed by economic distress. Trump is likely to insist that Trudeau axe some of Canada’s increasingly protectionist measures that may violate the current iteration of NAFTA, such as dairy import controls.

Despite these hurdles – and the fact that Trump and Trudeau may never truly see eye to eye – America and Canada’s close relationship is likely to be largely unaffected by the Trump turbulence.

TURKEY ON TOUR

President Erdogan is hopping his way across the Gulf this week, with stops in Bahrain, Saudi Arabia and Qatar. Monday will see the Turkish leader arrive in Riyadh for talks on trade and security cooperation.

While relations between Turkey and Saudi Arabia cooled in 2013 over a disagreement about a coup in Egypt, a shared interest in countering Iran’s regional influence has brought the two together again.

Last week, the Saudi and Turkish foreign ministers met in Ankara for the first ever Turkish-Saudi Coordination Council. This new talking shop aims to boost bilateral trade and investment, which was valued at $8 billion in 2016. The leaders of the two regional powers are also expected to discuss a free trade agreement between GCC member states and Turkey, although its implementation is some way off.

With both countries active in the Syrian theatre, Erdogan and his counterpart won’t be able to ignore regional security. A visit to Ankara by CIA Director Mike Pompeo last week will focus talks on how Middle Eastern countries can get the most out of President Trump – who’s viewed favourably in the region, which had tired of his overly cautious and Tehran-friendly predecessor.

Go deeper: Not at my level: Erdogan and the Middle East

HAPPENING ELSEWHERE…

OPEC will release its monthly oil report. Figures released recently suggest a surprisingly high level of compliance with an oil production cut deal agreed to late last year. This is unusual for an organisation known more for its divisions than unity. It may be a sign that low oil prices are really beginning to bite.

Japan’s government will announce GDP growth figures at midnight GMT. Economists are expecting modest growth for the quarter to December, somewhere around the 0.3% mark.

The PM of Moldova will meet with his counterparts in Kiev.

The European Commission will publish its economic forecasts for the Eurozone covering GDP growth, inflation and employment figures.

At 1200 GMT India will announce whether the central bank hit its January inflation target of 5% by the end of March. It’s likely to undershoot by one and a half percentage points.