WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: Independent centrist Emmanuel Macron won with 23.9% the first round of the French presidential elections that were held on Sunday April 23rd and qualified for the May 7th second and last round alongside far-right nationalist Marine Le Pen who fared slightly worse than polls implied gaining 21.5%. With the first round yielding the most market friendly outcome, the EUR gained across the board while the JPY was among the main underperformers weighed down by improved market sentiment. Looking at this week’s calendar, focus is on the ECB monetary policy meeting on Thursday, the Trump tax plan which is expected to be announced on Wednesday and Q1 GDP data for both UK and US on Friday.
GREECE: In 2016, Greece attained a primary surplus of 3.9% of GDP (in ESA 2010 terms as released by the Hellenic Statistical Authority in the context of the first Excessive Deficit Procedure notification for 2017) and 4.19% of GDP (in programme terms), significantly above the programme target of 0.5% of GDP. The institutions’ (EC/ECB/ESM/IMF) technical staff and mission heads are expected to return to Athens tomorrow (Tuesday, April 25th) with the intention to close any remaining items – primarily issues pertaining to the labour market reform and the Public Power Corporation – and reach a staff level agreement (SLA) in time for the 22nd May Eurogroup. According to the Bank of Greece, in the period January – February 2017 receipts from travel services contracted by 2.7% YoY (against +2.0% YoY in the same period of 2016) while inbound travelers decreased by 2.8% YoY (against -11% YoY in the same period of 2016).
SOUTH EASTERN EUROPE
SERBIA: The EUR/RSD moved lower last week, hitting a 3-month trough near 123.45 in a return to its start-of-the-year levels.
CESEE MARKETS: Emerging market assets kicked off the week on a positive footing, broadly staging a relief rally after the results of the first round of Presidential elections in France mitigated worries over a further rise of Euro-skepticism in the European Union.
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