Daily Overview of Global Markets & the SEE Region (Friday, 26 April, 2019)
WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS: In the monetary policy meeting yesterday, the ECB left its monetary policy unchanged, disappointing those who were positioned for lower interest rates following a recent string of weaker-than-expected euro area data. Nevertheless, the Governing Council prepared the ground for further policy easing by changing its forward guidance to expecting the key interest rates to remain “at the present or lower levels” at least through the first half of 2020. In reaction to the ECB’s message for further policy stimulus, the EUR weakened and the 10-yr Bund yield hit a fresh record low of -0.42% yesterday before rising to -0.37% in early European trade today on ECB President Mario Draghi’s comments in the post-meeting press conference that the monetary policy decision was not taken unanimously and the recession risk is regarded as “pretty low”. In terms of data releases today, focus is on the advance reading of US Q2 GDP.
GREECE: According to the Ministry of Finance data for the execution of the State Budget on a modified cash basis, State Budget balance for the period Jan-Jun 2019 presented a deficit of €2,687mn, against a target of a deficit of €4,819mn foreseen in the 2019 Budget and a deficit of €2,440mn for the same period of 2018. The State Budget Primary Balance amounted to a surplus of €381mn, against the primary deficit target of €1,573mn and the primary deficit of €46mn achieved in the same period of 2018.
SOUTH EASTERN EUROPE
TURKEY: The Central Bank of Turkey slashed the key policy rate by 425bps to 19.75%.
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