According to President of the European Central Bank (ECB) Christine Lagarde, the eurozone economy is expected to contract more sharply in 2020 than previously assumed. As a result of the corona crisis, the ECB now anticipates a contraction of between 8% and 12%, while it previously assumed that the economy would contract between 5% and 12%. According to Lagarde, the scenario currently used for projections is a “medium to heavy” scenario. Next week, the ECB will release new forecasts for economic growth and inflation in the eurozone.
Statistics Netherlands (CBS) has reported that producer confidence rebounded slightly in May 2020, from an all-time low in April 2020. The index measuring confidence rose to -25.1 in May, from -28.7 in April. This was the lowest point ever recorded. The greatest improvement was recorded in the expectation of economic activity in the next twelve months. Opinions on inventory of finished products also improved in May. Looking at the individual sectors, the greatest increase in producer confidence was observed in the transport industry, while producer confidence in the food and beverage industry decreased.
In the Beige Book, the Federal Reserve’s report on economic activity in the United States, is stated that the corona crisis continues to have a very negative impact on the US economy. The prospects for an economic recovery are also very uncertain. Moreover, due to high unemployment in the US, economic recovery will be slower than previously assumed.
The 6M Euribor increased with 2 basis points to -0.13% compared to previous business day. The 10Y Swap is unchanged at -0.11% 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.
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