Market Information Monday 6 July 2020

According to Klaas Knot, president of De Nederlandsche Bank (DNB), it is possible that the European Central Bank will not use the full 1350 billion euros in the purchase program to fight the corona crisis. In addition, there are risks associated with relying too long on certain crisis measures by the central bank for the euro area. Knot argued at an online event of Bloomberg for a good mix of support measures, not just looking at central banks for help with purchase programs or interest rate cuts. According to the DNB president, this did happen during the recovery after the financial crisis. One of the drawbacks was the cheap money policy that encouraged higher debts.

Consumer confidence in the Netherlands improved again in the second half of June, but the increase was extremely limited. The indicator of the Dutch Central Bureau of Statistics (CBS) for consumer confidence was -26 in the second half of June against -27 in the first half of June. According to the CBS, the willingness to buy among households improved from -11 to -8. The opinion on the economic climate remained at -52.

The British researcher company Markit reports that the services sector of several European countries picked up again in June after a strong dip in April and a cautious recovery in May. A score of 48.3 was measured for the entire eurozone. The service sector includes, amongst others, tourism, retail, hospitality and aviation, which were deeply affected by measures to fight the spread of the corona virus.

The 6M Euribor is unchanged at -0.30% compared to previous business day. The 10Y Swap is unchanged at -0.16% 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.