WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: Reduced appetite for risk-taking in the last trading day of the year favored the safe-haven appeal of German government bonds. Against this background, the 10-yr Bund yield was hovering around 0.544% in European trade at the time of writing, within distance from an all-time closing low of 0.540% marked in the prior session having declined by ca 138.5bps this year, the biggest annual fall in near six years. Separately, the DXY dollar index is on track to end 2014 with gains of ca 12.3%, its best performance since 2005.
GREECE: In a statement issued y-day, Fitch Ratings said that early general elections following parliament’s failure to elect new President of the Hellenic Republic “increase the risks to Greece’s creditworthiness”. On the data front, euro-denominated deposits & repos of domestic households and non-financial corporations in Greek MFIs excluding the Bank of Greece (BoG) dropped in November for the second month in a row, as businesses and households need to meet particularly high tax liabilities ahead of year-end.
SOUTH EASTERN EUROPE
SERBIA: The Public Debt Agency sold EUR 75m in 2Y T-bonds on Tuesday; the auction was well received producing a yield of 3.50%, 30bps lower than that reached when paper of the same maturity was offered on Oct 28th.
BULGARIA: According to the National Statistical Institute, Bulgaria’s business sentiment index dropped by 1.1 percentage point in December compared to a moth earlier due to the less favorable business climate in retail trade and construction.
Viewers can read the full report herebelow: Dailyoverview December 31, 2014