WORLD ECONOMIC & MARKET DEVELOPMENTS
Eurozone flash HICP resumed its downtrend in September hitting a new cycle low of 0.3%YoY, fuelling expectations that the ECB may eventually embark on a quantitative easing program in the coming months. In response to the above, the EUR moved lower while German Bunds firmed.
The heads of the troika mission arrived in Athens y-day, as expected, to hold discussions with domestic authorities in the context of Greece’s 5th program review. The first high-level meeting between Greece’s Minister of Finance Gikas Hardouvelis and the troika heads is scheduled to take place this morning.
SOUTH EASTERN EUROPE
SERBIA: The EUR/RSD kicked off the week little changed.
ROMANIA: NBR widely expected to cut the key policy rate by 25bp to 3.00% at today’s MPC meeting.
BULGARIA: Business sentiment decreased in September for the fourth month running
CESEE MARKETS: The majority of emerging stock markets extended Monday’s losses in early European trade today amid social unrest in Hong Kong, while China’s disappointing HSBC manufacturing data for September added to concerns about the outlook of the world’s second largest economy. News that incumbent Brazilian President Dina Roussef was the front runner in a new poll ahead of Sunday’s election also weighed on emerging bourses. Yet, bucking the negative trend in emerging stock markets most CESEE bourses moved higher earlier today. Separately, regional currencies were mixed at the time of writing with the Turkish lira recovering a small part of its recent losses.