Market Information Wednesday 18 September 2019

Yesterday on Budget Day, the Dutch government announced that the economy is expected to grow by 1.5% in 2020, compared to 1.8% growth this year. Collectively agreed wages will increase by 2.5% and unemployment will equal 3.5% in 2020. Based on the purchasing power estimates for 2020, presented in the Macro Economic Outlooks (MEV), an average increase of 2,1% is expected in 2020. This will mainly concern the active population of the Netherlands. In addition, the Minister of Finance, Wopke Hoekstra, announced that an investment fund will be established for EUR 50 billion.

The Federal Reserve intervened yesterday in the repurchase agreement market to deal with a sudden shortage in the money market. It concerns a volume of USD 75 billion. These repurchase agreements are a common approach for banks to finance the purchase of bonds.

Moody’s Investor Service changed the outlook for Hong Kong’s sovereign rating from stable to negative, a backdrop of persistent political unrest between protesters and the government. The move follows Fitch Ratings’ downgrade earlier this month on Hong Kong’s long-term foreign-currency-issuer rating to “AA” from “AA+”.

The 6M Euribor increased with 2 basis points to -0.36% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.06% 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.