WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: US Treasuries and German Bunds retained a firm tone in European trade on Wednesday supported by heightened concerns about the global growth outlook following a recent string of disappointing manufacturing surveys around the world. In FX markets, the USD recovered some of its recent hefty losses on position adjustments ahead of Friday’s US non-farm payrolls report for April.
GREECE: The Euro Working Group will reportedly hold a teleconference later today ahead of the extraordinary Eurogroup scheduled for Monday, May 9th. According to comments by two unnamed European officials, the upcoming Eurogroup is unlikely to result in a final agreement between Greece and its official creditors on the contingent package of additional measures worth €3.6bn that will have to be activated if Greece fails to meet the 3.5%-of-GDP primary surplus target by 2018. According to the spring 2016 European Economic Forecast, the European Commission expects Greece’s real GDP to contract by 0.3% in 2016, slightly less than 0.7% expected earlier, as the adverse trends in the second half of 2015 turned out more moderate than projected. The seasonally adjusted Markit Manufacturing Purchasing Managers’ Index rose to a three-month high of 49.7 in April from 49.0 in March.
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