Market Information Friday 7 October 2022

Central banks worldwide should continue to raise interest rates despite the fragile outlook for the global economy, according to IMF director Kristalina Georgieva. The IMF will publish an update of its World Economic Outlook next week, in which the global growth forecast for 2023 will be revised downwards, Georgieva said. “We will emphasise that the risk of recession is growing”. Nevertheless, central banks must “stay on course” in their fight to bring down the highest inflation rate in 40 years, even at the risk of tightening too fast and too much.

Eurozone retail sales rose 0.3% month-on-month in August, following a 0.4% drop in July, according to figures from EuroStat published on Thursday. Compared to August last year, retail sales were 2.0% lower. Economists on average expected a 0.4% drop beforehand. The steepest decline was in the Netherlands, down 2.2%, followed by Germany, down 1.3%. On the contrary, in Belgium, sales rose by 1.4%.

Oil prices rose further on Thursday, with an increase of 1% to a price of USD 88.45 for a barrel of West Texas Intermediate. On Wednesday, OPEC+ announced a production cut of 2 million barrels a day, which market experts say will be particularly beneficial for Russia. Morgan Stanley analysts do not expect OPEC+ to actually cut production by 2 million barrels a day, but presumably by less than half of that. “Compared to September production, we estimate the impact on supply at 0.8 million barrels per day,” Morgan Stanley said.

The 6M Euribor decreased with 3 basis points to 1.73% compared to previous business day. The 10Y Swap increased with 12 basis points to 3.08% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.