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MORNING BID EUROPE-Plenty of questions for Draghi

* A look at the day ahead from EMEA chief desk editor Jeremy Gaunt and EMEA deputy markets editor Nigel Stephenson. The views expressed are their own.

LONDON, July 21 (Reuters) - Jaw-jaw, not more-more from the ECB today. The European Central Bank is unlikely to do anything when it meets on policy, but its president, Mario Draghi, can be expected to say things to get markets ready for later moves.

He will undoubtedly be asked about Italy's debt-laden banks, Britain's back-turning on the EU, and how the ECB can buy bonds that don't exist.

The latter is a question of a pledge to buy qualified assets but then finding that circumstances are limiting the amount that actually qualify. There may be hints on tweaking the rules at a later date.

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Germany's finance ministry reported overnight that the economy remains in good shape although Brexit has increased the risks. It (Other OTC: ITGL - news) was all very upbeat - in contrast to the plunging ZEW sentiment survey earlier in the week.

On Brexit, meanwhile, Britain's Prime Minister Theresa May meets French President Francois Hollande a day after her chat with Germany's Angela Merkel. From outward appearances (and spin), it seems to have gone quite well.

None of this is a negotiation, mind you; the EU says it won't do that until Article 50 is triggered, which is not expected until next year.

Markets

The dollar is a shade weaker after scaling-month highs against its major peers on Wednesday. The yen, however, is down again versus the dollar as markets anticipate more stimulus in the coming weeks, whether from the government or in the form of easier policy from the Bank of Japan, which meets next week. The ECB meets today and is not expected to change rates, though Mario Draghi may signal more action to come later in the year. He's bound to be asked about struggling Italian banks and any tweaks to the 1.7 trillion bond-buying stimulus programme, for which eligible bonds are getting scarce. With expectations of a Fed rate hike on the rise again, having been wiped out in the immediate aftermath of the Brexit vote, the gap between benchmark German and U.S (Other OTC: UBGXF - news) . government bond yields hit its widest in six weeks before pulling back.

Emerging market equities climbed to fresh 8-month highs on Thursday, with Hong Kong shares leading the gains, up 1 pct. The Turkish lira bounced over 1 percent, having crashed to a record low against the dollar on Wednesday after ratings agency S&P cut its sovereign credit outlook to negative from stable and downgraded it to BB from BB+. President Erdogan has declared a 3-month state of emergency, widening a crackdown after a failed military coup.

Upcoming data/events/themes for market reports on Thursday

- Europe corp events: SAAB (LSE: 0GWL.L - news) , SABMiller (Xetra: BRW1.DE - news) update, Swedbank (LSE: 0H6T.L - news)

- Swiss June trade

- France July business climate

- UK June retail sales

- ECB rate decision, press conference

- US Q2 earnings: BONY Mellon, GM (NYSE: GM - news) , Amazon, Biogen (NasdaqGS: BIIB - news) , Starbucks (Swiss: SBUX.SW - news) , PayPal, Visa (Xetra: A0NC7B - news) , Union Pacific (Swiss: UNP.SW - news) , DR Horton (NYSE: DHI - news) , Travellers etc

- US July Philly Fed index, June existing home sales

(editing by)