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Daily Overview of Global Markets & the SEE Region (Wednesday, 26 June, 2019)
HIGHLIGHTS
WORLD ECONOMIC & MARKET DEVELOPMENTS
GLOBAL MARKETS:   US government bonds remained well supported in early European trade on Wednesday on market anxiety ahead of this week’s scheduled meeting between US President Donald Trump and his Chinese counterpart Xi Jinping on the sidelines of the G20 meeting on 28-29 June. Yesterday’s poor US data, which fueled concerns that US/China trade tensions are taking a toll on the domestic economy, also favored US sovereign paper. Against this background, yesterday’s comments by St. Louis Fed President James Bullard, seen as one of the most dovish FOMC participants, that pushed back expectations for an aggressive Fed rate cut in the near future, failed to exert a long lasting impact on US government bonds. In FX markets, the DXY index recovered from yesterday’s three-month lows but still 1.6% lower compared to mid-June highs, shortly before the Fed’s June meeting. Looking at today’s G10 calendar, the highlight is US durable goods orders for May.
GREECE: According to the Ministry of Finance latest available data for the execution of the State Budget on a modified cash basis, the State Budget balance for the period January – May 2019 registered a deficit of €1.8bn against a target of a deficit of €4bn for the same period in the 2019 Budget introductory report and a deficit of €1bn for the same period of 2018. The State Budget primary balance recorded a surplus of €916mn against a primary deficit target of €1.4bn and a primary surplus of €853mn in the same period of 2018.
SOUTH EASTERN EUROPE
CYPRUS: The non-performing exposures (NPEs) ratio edged up to 31.3% in February from 30.3% in January, mirroring the decline in the loans stock by €917mn.
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