HIGHLIGHTS
WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: Asian equity markets ended lower today amid concerns about an escalation in trade tensions between the world’s two biggest economies. Meanwhile, equity markets in Europe were modestly firmer in early trade amid market optimism over a “soft” Brexit deal and hopes that Italy’s updated Stability Programme (to be published by 27 September) will show a deficit-to-GDP ratio that will not deviate much from the target envisioned in the Stability Programme submitted to the European Commission last May. In fixed income, UST and Bund yields were trading close to yesterday’s fresh highs presumably due to supply jitters. In FX markets, the GBP gave back some of yesterday’s gains and the EUR/USD continued to hover around the 1.1600 level. Today’s calendar is quite thin. We expect August industrial production from the euro area and the Fed’s Beige Book.
GREECE: The Heads of the institutions are scheduled to meet the Greek Finance Minister Euclid Tsakalotos and Alternate Finance Minister George Chouliarakis today in Athens in the context of their first mission to Greece under the Enhanced Post Programme Surveillance. ESM Managing Director Klaus Regling opined against any backtracking from agreed reforms on behalf of Greece, including social security ones, arguing that the funds and debt relief measures that have been or will be granted to Greece were based on those reforms among others. The break-up of DEPA into two entities, DEPA networks and international projects and DEPA wholesale and retail, is reportedly moving on so that the State can proceed to selling a majority stake of 50% plus 1 share of the latter.
SOUTH EASTERN EUROPE
ROMANIA: Headline Inflation climbed again above 5% on an annual basis in August following a temporary decline in July.
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