Market Information Wednesday 21 August 2019

The construction production in the eurozone is stabilizing. Based on first estimates of the Statistical Office of the European Union (Eurostat) the construction production in June remained unchanged compared to previous month. In May the production decreased by 0.3%.

Today, the German government will launch a 30-year government bond with a coupon of 0%. The total size of the government bond is € 2.2 billion. The German central bank anticipates a recession for the country as the global economic growth rate decreases. This results in an increasing demand for “safe” government bonds.

The Italian Prime Minister Giuseppe Conte resigned, he announced his resignation on Tuesday afternoon in the Senate. Conte blamed vice-president Matteo Salvini for placing his self-interest above that of the state. This brings an end to the coalition government of the Lega and the Five Star Movement. As from today, President Sergio Mattarella will have to determine whether a new government can be formed. Otherwise, new elections will be held this fall. As a result, the 10-year Italian government bond yields touched 1.31% on Tuesday, the lowest level since 2016.

The 6M Euribor increased with 1 basis point to -0.42% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.27% 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.