WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: Mirroring the negative sentiment in Wall Street overnight, Asian equity indices closed in the red on Friday and major European bourses opened lower, amid renewed concerns about the progress of US tax reform plan. Turning to the ECB’s monetary policy meeting on 14th December, in line with expectations, the Governing Council (GC) left its monetary policy unchanged, reiterating that policy rates would remain at current levels for an extended period of time and well past the horizon of QE. Looking at today’s calendar, the conclusion of the EU Council summit is expected to take centre stage. On the data front, October euro area trade data, December empire manufacturing and November industrial production for the US are due later in the day. Going forward, with the Central Banks meetings out the way and little of note on the data front, markets are likely to be in a subdued mood into the weekend.
SOUTH EASTERN EUROPE
CESEE MARKETS: The majority of emerging market assets lost ground in early European trade on Friday on deteriorating risk sentiment amid increased uncertainty about the proposed US tax reform. Looking into today’s calendar, sovereign credit rating reviews by S&P and Fitch for Serbia take centre stage.