• China’s National Bureau of Statistics reported on Monday that the gross domestic product (GDP) of China increased 6.2% in the second quarter of 2019, highlighting that it is in a reasonable range given the complex domestic and international environment. This growth of the economy is in line with what analysts predicted and represents the slowest rate of expansion of the Asian giant since the first quarter of 1992. However, its quarter on quarter reading of 1.6% was ahead of forecasts and furthermore industrial production, retail sales and urban investment also beat the expectations.
  • In relation to trade, China suggested that substantial discussions had yet to resume, and signaled it would not purchase large amounts of US farm products until any specific progress was made in the negotiations. Moreover, the Chinese Government claimed that it will not cooperate with US companies involved in the sale of arms to Taiwan, a message it has sent after the Pentagon last week authorised a sale of arms worth 2.2 billion dollars to the Taiwanese authorities.
  • Regarding economic indicators, Federal Reserve Bank of New York's monthly report revealed that the business activity in the manufacturing sector has seen an increase from -8.6 in June to +4.3 in July (consensus forecast was +2.0). This result was the biggest rise in more than two years.
  • The US yield curve steepened in the past week by the most in almost three years, with no significant changes today, reflecting optimism that a rate cut by the Federal Reserve will keep the US economy growing. This monday, most eurozone government bond yields inched down from recent three-and-a-half-week highs in the last week. As regards currencies, FX showed minor changes. The pound (GBP) continue pressured by ongoing political uncertainties. Oil prices remained steady, after the increase in the last few days due to geopolitical tensions, falling inventories and a better tone for risk sentiment in a context of dovish central banks.
  • European stock markets rose slightly while US stock markets remained flat as Wall Street’s main indexes finished last week at record highs. At the start of the second quarter earnings season, the third largest U.S bank, Citigroup, improved expectations but the interest margin fell which impacted bank stocks.

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