Concern Reintensifies about Greek Debt
May 5, 2015
Greek share prices fell 3.5%, and the Greek 10-year sovereign debt yield jumped 22 basis points.
New quarterly GDP forecasts released by the European Commission revised projected Greek growth in 2015 to 0.5% from 2.5% previously but bumped up the eurozone projected growth rate to 1.5% from 1.3%. Growth is expected to reach 3.6% in Ireland, 2.8% in Spain, 1.9% in Germany, 1.6% in The Netherlands and Portugal, 1.1% in Belgium and France and 0.6% in Italy. Greece is not the weakest, however. Growth is projected at only 0.3% in Finland and negative 0.5% in Cyprus. The EU Commission sees eurozone growth accelerating to 1.9% in 2016.
Producer prices in Euroland increased for a second straight month in March, this time by 0.2%. Energy went up 0.5%, while all other producer prices collectively firmed 0.2%. The 12-month decline in the PPI narrowed to 2.3% from 2.8%. Producer prices dropped 1.4% in the first quarter but were 0.3% higher in March than the quarterly average level.
The Reserve Bank of Australia cut its Official Cash Rate to 2.0%, a record low, from 2.25%. This expected action was the second cut of 2015, the first being in February.
The dollar fell 0.6% against the Aussie dollar and 0.4% versus the Swiss franc. The greenback firmed 0.2% relative to the yen and 0.1% vis-a-vis the kiwi. The dollar dipped 0.1% against the loonie and sterling and is unchanged relative to the yuan.
Share prices slumped 4.0% in China, 1.3% in Hong Kong, and 0.3% in Taiwan and Singapore. In Europe, equities have fallen 0.9% in Italy and 0.6% in Spain but just 0.1% in Germany and France. With just two days before the British election, the Ftse is up 0.4%, and the 10-year British gilt yield has risen another five basis points.
German bunds are steady. So is gold at $1,187.20 per ounce, but WTI oil has advanced 0.9% to $59.47 per barrel.
Non-oil purchasing manager survey results for April were reported for Egypt, Saudi Arabia and the United Arab Emirates.
- Egypt’s PMI was below 50 for a fourth straight month but at a 4-month high of 49.8. Orders and output rose marginally.
- The Saudi PMI slid 1.8 points to a still-elevated 3-month low of 58.3.
- The UAE PMI printed at a 2-month high of 56.8 in April after a 17-month low of 56.3 in March.
Australia’s service-sector purchasing managers index fell 0.5 points to a 3-month low of 49.7 in April.
Russia’s manufacturing PMI was under 50 for a fifth consecutive time, printing at a 2-month high of 48.9, but orders decreased faster than in March.
The British construction PMI sank 3.6 points to a 22-month low of 54.2 last month. Orders and production also grew at their weakest pace since mid-2013.
Australia’s trade deficit narrowed 18% to A$ 1.322 billion in March and amounted to A$ 3.93 billion in the first quarter of 2015.
Japanese markets remained closed. Today is Children’s Day, and Constitution Day will be observed tomorrow as Golden Week draws to a close.
Consumer price inflation in the Philippines slowed to 2.2% last month, with a core rate of 2.5%. Producer prices in the year to March fell by 5.4%.
Indonesian real GDP slid 0.2% on quarter and slowed to an on-year advance of 4.7% in the first quarter, which was the lowest pace since 2009. Taiwanese consumer prices fell 0.8% between April 2014 and April 2015. Retail sales volume in Hong Kong rose 0.8% in the year to March.
Swedish industrial output rose 0.8% in March, but orders fell by 1.2% in the first quarter.
In Romania, producer prices and retail sales declined by 1.1% and 0.5% in the year to March.
Business sentiment in South Africa improved 0.9% between March and April.
U.S. and Canadian trade figures get released today. The U.S. IBD/TIPP optimism index and service sector PMI (as compiled by Markit Economics) arrive, too.
Copyright 2015, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Australian trade, Euroland PPI
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