Monthly Archives: August 2018

Greece Successfully Exits Bailout

Greece finally emerged out of its final bailout programme helping it to re-enter the financial markets to raise own funds for the first time in eight years.

“Greece is now in a position where it can enjoy the full extent of euro area membership, abiding by the same rules as every other euro country,” Eurogroup President Mario Centeno said.

However, Greece’s troubles are not yet over as it is emerging from the bailout with Eurozone’s highest debt burden, which was about 180 percent of GDP, as of 2017.

The focus now will be to reduce the huge debt that is forecast to reduce drastically over the coming years.

The country, which was sunk deep in economic crisis, received three bailouts since 2010. Economic troubles led to a severe political crisis within Greece and the euro area.

Talks between the government and its international lenders for repeated bailouts were often dramatic and triggered speculation that the country may leave the single currency union, a scenario then dubbed “Grexit”.

Now, after a successful exit from bailouts, Greece will enter into post-programme monitoring.

During the final 3-year programme, which started in August 2015, the permanent fund, the European Stability Mechanism, provided EUR 61.9 billion to Greece for macroeconomic adjustment and bank recapitalization.

Through these years, Greece implemented stringent financial and tax reforms among other measures demanded by lenders and the nation was subjected to both political and economic turbulence during bailout talks with lenders.

Nonetheless, Athens eliminated its high fiscal deficit and the economy finally returned to growth from recession in 2013.

Athens had a huge government deficit of above 15 percent of GDP in 2009, which turned to a surplus in 2017. Still, Greece faces high unemployment and poverty rates.

“As the ESM and EFSF [ European Financial Stability Facility] are Greece’s largest creditors, holding 55 percent of total Greek government debt, our interests are aligned with those of Greece,” ESM Managing Director Klaus Regling said.

“We want Greece to be another success story, to be prosperous and a country trusted by investors,” Regling added.

Greece had received EUR 52.9 billion through bilateral loans from EU member states during the first bailout programme that ended in March 2012, and EUR 141.8 billion in loans from the EFSF between 2012 and 2015.

In addition, the International Monetary Fund disbursed a total loan volume of EUR 32.1 billion to Greece in parallel to the Greek Loan Facility and the EFSF programme of which around EUR 21 billion has already been repaid.

The material has been provided by InstaForex Company – www.instaforex.com

Luxembourg Jobless Rate Remains Stable

Luxembourg’s unemployment rate held steady in July, after easing slightly in the previous month, figures from the statistical office STATEC showed Monday.

The seasonally adjusted jobless rate came in at 5.5 percent in July, the same rate as in June.

In the corresponding month last year, the jobless rate was 6.0 percent.

The number of unemployed people totaled 15,494 in July, down from 15,514 in the prior month. A year ago, it was 16,455.

The material has been provided by InstaForex Company – www.instaforex.com

Pound Strengthens Against Majors

The pound climbed against its major rivals in the European session on Monday.

The pound rose to 0.8939 against the euro, reversing from a low of 0.8975 hit at 5:00 pm ET.

The pound climbed to 6-day highs of 1.2766 against the dollar and 1.2712 against the franc, from its early lows of 1.2729 and 1.2666, respectively.

The U.K. currency reversed from an early low of 140.72 against the yen, rising to a 4-day high of 141.22.

If the pound rises further, it may find resistance around 0.88 against the euro, 144.00 against the yen and 1.29 against both the dollar and the franc.

The material has been provided by InstaForex Company – www.instaforex.com

Poland Industrial Production Grows More Than Forecast

Poland’s industrial production expanded at a faster-than-expected pace in July, figures from Statistics Poland showed Wednesday.

Industrial production surged 10.3 percent year-over-year in July, exceeding economists’ forecast for an increase of 9.8 percent.

Among components, manufacturing production grew 10.2 percent annually in July and mining and quarrying output rose by 4.4 percent.

Data also showed that construction output logged a double-digit growth of 18.7 percent over the year.

On a monthly basis, industrial production declined 5.4 percent in July, faster than the expected fall of 5.7 percent.

Another report from the statistical office showed that industrial producer prices rose 2.5 percent annually in July, below the 3.5 percent increase economists had forecast.

Month-on-month, producer prices edged up 0.1 percent in July, in line with expectations.

The material has been provided by InstaForex Company – www.instaforex.com

Gold Gains As Bargain Hunters Step In

Gold prices rose on Monday as bargain hunters came into the market ahead of planned trade talks between the United States and China.

Spot gold was up 0.15 percent at $1,186.40 an ounce after hitting a 19-month low last week, pressured by dollar strength amid geopolitical tensions and expectations of faster interest rate hikes. U.S. gold futures were up 0.81 percent at $1,193.80 an ounce.

China and the United States will hold lower-level trade talks this week, just before new U.S. tariffs on $16 billion of Chinese goods take effect.

Traders also looked ahead to the release of the FOMC meeting minutes this week and a meeting of central bankers at the Kansas City Fed’s Jackson Hole symposium for clues on next month’s U.S. interest rate hike.

The material has been provided by InstaForex Company – www.instaforex.com