Erste Bank Research Team
Erste Bank
Chart of the Day:
Raiffeisen Bank International Subordinated Debt: Finally, some respite for RBI. The price of sub debt was in freefall as speculation rose that coupon payments would be blocked by regulators. Yesterday’s ad hoc statement gave investors some hope that would not be the case. The board also announced that a divestment programme would supplant any need to raise additional capital.
Analysts’ View:
HR Macro: December industrial production brought a positive surprise, with robust 5.3% y/y growth above both our and market expectations (2.5% and 3%, respectively). While the monthly data revealed a marginal decline of 0.2% (s.a.), strong production in the intermediate goods sector pushed the headline figure into the black y/y. The December output data also displayed the strongest YTD performance in 2014, which concluded a cumulative 2014 industrial rebound of 1.3% y/y. As for the prospective 2015 performance potential, we see a low base effect and external impulses supporting production , balancing out weak domestic demand which is clearly putting downside pressure on the recovery profile. As for our capital market forecasts, we expect them to remain unaffected by this release.
Traders’ Comments:
CEE Fixed income: A meeting between Greek Prime Minister, Alexis Tsipras, and EU Parliament President, Martin Schulz, was conciliatory rather than antagonizing and markets preferred to focus on the positives amid very mixed signals from the Greek government. The jury is out about how things on the debt restructuring front will develop in Greece but in our region debt restructuring is already very real in Ukraine and Belarus. In spite of this, CEE fixed income had a calm day with a bit more two-way flow and both the HUF and PLN gained as tensions eased a little. For the moment, price movements in secondary bond markets can broadly be summed up as directionless but primary markets are still heading in one direction only. Erste Group Bank priced EUR 500 m in 10Y covered bonds at MS +6 bps, down from IPT of +10 bps.
This document is intended as an additional information source, aimed towards our customers. It is based on the best resources available to the authors at press time. The information and data sources utilised are deemed reliable, however, Erste Bank Sparkassen (CR) and affiliates do not take any responsibility for accuracy nor completeness of the information contained herein. This document is neither an offer nor an invitation to buy or sell any securities.
Recommended Content
Editors’ Picks
USD/JPY holds near 155.50 after Tokyo CPI inflation eases more than expected
USD/JPY is trading tightly just below the 156.00 handle, hugging multi-year highs as the Yen continues to deflate. The pair is trading into 30-plus year highs, and bullish momentum is targeting all-time record bids beyond 160.00, a price level the pair hasn’t reached since 1990.
AUD/USD stands firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday. The AUD/USD advance was sponsored by a United States report showing the economy is growing below estimates while inflation picked up.
Gold soars as US economic woes and inflation fears grip investors
Gold prices advanced modestly during Thursday’s North American session, gaining more than 0.5% following the release of crucial economic data from the United States. GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the US Fed could lower borrowing costs.
Ethereum could remain inside key range as Consensys sues SEC over ETH security status
Ethereum appears to have returned to its consolidating move on Thursday, canceling rally expectations. This comes after Consensys filed a lawsuit against the US SEC and insider sources informing Reuters of the unlikelihood of a spot ETH ETF approval in May.
Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. The BoJ will announce its decision on Friday at around 3:00 GMT.