Market Information Wednesday 14 October 2020

German investors’ confidence in the future decreased in October, according to the ZEW index released yesterday. Economists expected the index to decrease to a reading of 72 but the index decreased to 56.1 from 77.4 a month earlier. The index that measures confidence in the current situation was still negative at 59.5 from minus 66.2 in September. According to the research institute, expectations for the Eurozone economy decreased in October to a reading of 52.3 compared to 73.9 in September.

The Dutch economy will probably contract less this year than previously expected, according to the International Monetary Fund (IMF). For 2020, the IMF now expects a decline of 5.4% for the Netherlands, compared to an earlier forecasted decline of 7.7%. The IMF is also revising its expectations for the world economy. The global economy is expected to contract with 4.4% this year from a previously predicted 4.9% decline. The adjustments are mainly due to the fact that economic data in recent months turned out to be slightly better than initially assumed. The forecasts for the recovery have also been adjusted. In 2021, the Dutch economy will probably increase with 4%, compared to a previously predicted 5%. For the global economy the IMF expects an increase of 5.2% compared to the earlier assumed 5.4%. IMF chief economist Gita Gopinath points out that the forecasts are still very uncertain, due to the new wave of corona infections.

Inflation in the United States slightly increased again in September to 1.4% year-on-year from 1.3% in August according to the US government. The increase is in line with the expectations of economists. Core inflation, excluding fluctuating energy and food prices, was 1.7% as it was in August. On a monthly basis, US consumer prices increased by 0.2% compared to 0.4% in August.

The 6M Euribor is unchanged at -0.49% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.25% 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.