Dr. Platon Monokroussos, Chief Market Economist, Deputy General Manager, Eurobank Ergasias S.A
HIGHLIGHTS
WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: With the FOMC Chairman’s recent mildly hawkish remarks still in investors’ ears, the USD retained a positive tone with the EUR/USD and USD/JPY trading near 1.0750 and slightly above 120.00 respectively at the time of writing in European trade on Tuesday. Looking ahead, the USD is likely to remain in an upward trend in the coming sessions especially ifFriday’s US non-farm payrolls report delivers positive surprises.
GREECE: Discussions in Brussels between Greek authorities and the representatives from the four Institutions on the new more detailed list of reforms the Greek side submitted late last week are reportedly expected to continue today. According to the same sources, the said reform proposals do not incorporate any “recessionary measure” such as further reductions in salaries and wages. Reportedly, it includes measures aiming to boost State revenue by c. €3.7bn cumulatively this year, an amount that is deemed adequate for the generation of a primary budget surplus of 1.2% to 1.5%-of-GDP in 2015 under the assumption that 2015 real GDP output will grow by a positive annual rate of c. 1.4%.
CYPRUS: The amount of funding received by commercial banks from the Emergency Liquidity Assistance (ELA) stood at €7.2bn in February, slightly below January’s €7.4bn.
SOUTH EASTERN EUROPE
BULGARIA: According to media reports, the tourism ministry said on Monday that Bulgaria and China have decided to sign an agreement which is expected to increase the influx of Chinese tourists to the country.
ROMANIA: President Kalus Iohannis appointed on Monday economist and former European Union Funds minister Eugen Teodorovici as Romania’s new finance minister.
CESEE MARKETS: Emerging stock markets kicked off the week on a positive footing, erasing part of last week’s losses. Chinese shares led the way higher amid market optimism about the adoption of further policy stimulus by the country’s authorities aimed at supporting domestic economic activity. In the same positive tone, CEE currencies closed modestly firmer on Monday. Focus today is on the MPC meeting in Romania, where the Central Bank is anticipated to deliver a 25bps cut in its key policy rate to 2.00%.
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