WORLD ECONOMIC & MARKET DEVELOPMENTS
GREECE: The Greek PM Alexis Tsipras met the German Chancellor Angela Merkel in Berlin on Friday to discuss, among others, the progress of the 2nd programme review and the recent complication that arose in the wake of the Greek government’s decision for a one-off pay out to low-income pensioners and the postponement of the VAT increase in the refugee-hit islands. Mrs. Merkel referred the matter to the Eurogroup as the competent body to assess the issue and decide on whether or not to freeze the short-term debt relief measures for Greece.
SOUTH EASTERN EUROPE
SERBIA: The EUR/RSD inched up over the last few sessions, to end ca 0.2% higher on a weekly basis on Friday near 123.45, after the Fed’s upward revision in the 2017 rate forecasts. However, further upside for the pair appeared to be limited, possibly on National Bank of Serbia action. In other news, the IMF Executive Board completed on Friday the 6th review of Serbia’s 36-month €1.2bn Stand-By Arrangement. The completion of the review releases an amount of approximately €850.8mn, but Serbian authorities have signaled they plan to treat the arrangement as precautionary. Finally, S&P revised on Friday Serbia’s sovereign credit outlook to positive from stable, affirming its rating for the country at BB-, while Fitch affirmed its ratings on Serbia at BB-, with stable outlook.
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