WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: The minutes from the FOMC’s 29 October policy meeting supported the view that, barring an unanticipated shock that would adversely affect the growth outlook, the Central Bank is ready to embark on a rate tightening cycle at the next policy meeting on December 15-16. In response to the minutes, the majority of global equity markets were firmer in early trade on Thursday, US Treasuries gained some ground while the USD moved lower, giving back some of its recent hefty gains.
GREECE: The 300-seat Hellenic Parliament is scheduled to vote late today on a multi-bill containing the legislation required for the implementation of the outstanding milestones for the unlocking of the €12bn ESM loan installment. Provided that all goes as planned, the Euro Working Group is expected to convene on Friday to give the green light for the unlocking of the said loan installment and to discuss an initial draft of prior actions required for the release of the next ESM loan installment to Greece amounting to €1bn.
SOUTH EASTERN EUROPE
CESEE MARKETS: The majority of emerging stock markets closed in the red on Wednesday, weighed down by increased expectations for a Fed rate hike in December and escalating concerns about China’s- the world’s second largest – economy prospects. Last week’s terrorist attacks in Paris as well as a bomb scare in Germany and a deadly raid in the French capital earlier this week also continued to have a negative impact. Caution also prevailed ahead of the FOMC October 27/28 meeting minutes, released after the market close in Europe yesterday, which was eagerly awaited for any new clues regarding the FOMC’s monetary policy deliberations ahead. Separately, regional currencies ended little changed on Wednesday and government bonds broadly weakened.
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