Market information Tuesday June 9th 2015

The IMF positively adjusted its expectations for Spain’s economy. The IMF expects the Spanish economy to grow with 3.1% this year. Compared to April, the expectations were 2.5%. According to the IMF the growth is being pushed by domestic factors such as the labor market reforms as well as external influences such as the low oil price, weak Euro and aggressive ECB policy.

Three days ago, Prime Minister Alexis Tsipras told his parliament that the latest proposal from the EU and IMF was “absurd”. As German Chancellor Angela Merkel warned that time was running out for a reform-for-aid deal to keep Greece in the euro, Greece proclaimed today a new willingness to compromise with its international creditors. Furthermore, the Greek government said it is ready to negotiate a settlement acceptable to both sides by the end of this month – when Greece’s bailout program expires and it faces the prospect of default on its debts.

The stock markets of China are awaiting an immense change. Later today it will most likely be announced that the Shanghai and Shenzhen stock markets will be admitted to the MSCI Emerging Market Index, the most prominent emerging markets index. Analysts expect that European and US investors will buy several billions of Chinese stocks. This large inflow of money supposedly pushes the Chinese markets even further than the rally it is currently in.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap increased with 2 basis points to 1.19%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: update@zanders.eu.

Market information Monday June 8th 2015

The President of the European Commission Jean-Claude Juncker stated that he was “a little disappointed” about the harsh words that Greek Prime Minister Alexis Tsipras used regarding the proposals from the creditors to solve the Greek debt crisis. Last Friday Tsipras said that the proposals of the creditors are unrealistic and absurd. Finance Minister Yanis Veroufakis agrees with the Prime Minister. “As Minister of Finance I refuse to put my signature on a deal as it is now presented to us.”

The Iranian Ministry of Energy has announced that it expects Russia to import the first barrels of oil from Iran this week. Moscow will buy crude oil from Tehran in exchange for Russian goods as part of earlier trade agreements. Trade relations between Russia and Iran followed the conclusion of an agreement on the Iranian nuclear program. Besides Russia, Kazakhstan and Belarus will import Iranian oil.

Credit rating agency Moody’s has revised the prospect of Finland from “stable” to “negative”. Finland does retain its top AAA credit rating, but Moody’s is negative about Finland’s economy. Reasons for this negative outlook are the growing budget deficit and the increasing debt. Fitch lowered the credit rating outlook for Finland earlier, and Standard & Poor’s downgraded Finland to AA+.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap decreased by 2 basis points to 1.13%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: update@zanders.eu.

Market information Friday June 5th 2015

Although US GDP was 0.7% lower in the first quarter of 2015 than in 2014, the US jobs market has grown in May. The number of nonfarm payrolls increased by 225,000 jobs last month, after an increase of 223,000 in April. Unemployment is expected to remain stable at 5.4%, the lowest level in seven years.

According to the National Institute for Family Finance Information, a quarter of the 35-55 year old Dutch population experienced a decline in salary of 15% to 30% over the past three years. The fall in income is mainly caused by unemployment, disability or a new job with a lower salary.

The yield on 10-year German government bonds doubled from 0.49% to 0.99% in the past four days, whereas it was 0.07% in April. The yield on Dutch 10-year government bonds nearly doubled to 1.17% as well. The rapidly increasing yields come unexpectedly because the ECB is buying EUR 60 billion worth of bonds every month. ECB-president Draghi stated that markets have to get used to the increased volatility.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap decreased to 1.15%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: update@zanders.eu.

Market information Thursday 4th of June 2015

The Federal Reserve presented the Beige Book yesterday. Seven of the twelve districts reported a modest to moderate economic growth during the period April-May. The labor market however is growing substantially. Pay roller ADP reported a growth of 201,000 new jobs in the private sector in May. The official figures will be presented by the Department of Labor on Friday.

The Organization for Economic collaboration and Development (OECD) forecasts the Dutch economy will grow by 2% this year and by 2.2% in 2016. This is higher than the 1.4% growth in 2015 and 1.6% growth in 2016 presented last November by the organization.

Prior to talks about the Greek debt crisis this week, Euro group President Jeroen Dijsselbloem said he is not expecting it will lead to an agreement to emergency funding. Dijsselbloem was supposed to talk to both EC president Jean-Claude Juncker and Greek Prime Minister Alexis Tsipras in Brussels last night.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap increased by 18 basis points to 1.21%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: update@zanders.eu.

Market information Wednesday June 3rd 2015

The bonds of countries from the Eurozone have had a setback yesterday. The prices declined as the interest rates increased by 10 to 15 basis points. The interest rates in Germany increased by 16 basis points to 0.70%. In France, the interest rate increased by 15 basis points to 1% and the threshold of 2% was passed in Spain due to an increase of 11 basis points. The euro gained significantly against the dollar. The reason for these developments was the strong inflation figures announced by Eurostat and the negotiations with Greece. The inflation in the eurozone rose for the first time in 6 months, from 0% to 0.3%.

The Reserve Bank of India has lowered the interest rate for the third time this year. The key repo rate is lowered by 25 basis point to 7.25%, which is the lowest level since September 2013. Herewith the central bank hopes to boost the business investments. Bank Governor Raghuram Rajan said that the banks will pass the lower interest rates to their customers.

According to the anti-fraud office of the European Commission, OLAF, the last year at lease EUR 900 million of the European funds have been defrauded. That is more than twice as many as in 2013. The service is engaged in investigating reports of fraud and misappropriation of budget within the European institutions. Of the EUR 900 million, OlAF managed to recover EUR 206.6 million through the European Commission and the individual Member States. The service expects that eventually more money will be recovered. Most of the issues on which OlAF advices the Member States relate to abuse of EU structural funds that are destined for poorer regions and countries.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap increased by 12 basis points to 1.03%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: update@zanders.eu.