WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: The minutes from the April 26-27 FOMC policy meeting delivered a more hawkish than expected tone increasing market expectations for a June rate hike. Reacting to the above, major equity markets were weaker in early trade on Thursday and US Treasury yields rose helping the USD to move higher across the board.
GREECE: The Greek government submitted to the Parliament late on Wednesday evening the key omnibus bill which contains the legislation required for the implementation of the remaining 17 prior actions attached to the 1st programme review. The parliamentary debate is scheduled to commence on Saturday and end with a roll call vote on Sundayevening, in time for the next Eurogroup that convenes on May 24th. Provided that all goes as planned, the Eurogroup is expected to politically endorse the compliance report for Greece’s 1st programme review, opening the door for the release of the next loan tranche.
SOUTH EASTERN EUROPE
CYPRUS: The EU Commission announced yesterday the abrogation of the excessive deficit procedure against Cyprus one year ahead of the deadline.
CESEE MARKETS: Emerging market assets remained under pressure in European trade on Thursday in view of a hawkish shift in FOMC rate-tightening expectations. Despite deteriorating risk appetite, most regional currenciessomewhat recovered ground in European trade today recouping part of their recent losses. In the local rates markets, government bonds were mixed in morning European trade today. Focus today is on the ECB’s April 21 meeting minutes. On a regional level, the AKP is expected to name at a party meeting today the candidate for the post of party leader and Prime Minister, while Romania sells 2022 T-bonds.
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