TURKEY: Manufacturing PMI Hits Lowest Level Since Dec’22
Nov-01 08:15
- The ICI and S&P Global Manufacturing PMI for Turkey in October fell to 48.4 from 49.6 the month prior – marking the lowest reading since December 2022.
- Turkey may exclude financial institutions from its planned switch to hyperinflation accounting, Treasury and Finance Minister Simsek said according to Bloomberg, a move that could support the state’s tax income. Hyperinflation accounting involves adjusting companies’ financial statements to reflect the impact of extreme price changes on purchasing power and profitability.
- Emphasising that price stability is the top priority, Hurriyet report Simsek as saying: “We are carrying out a comprehensive study on the removal of ineffective exceptions, exemptions and discounts. In this context, we are reviewing tax laws.”
- The discount rate to be used in rediscount transactions carried out on notes that have a maximum of 3 months to maturity was raised to 35.75% from 30.75%, while the rate on advance transactions was raised to 36.75% from 31.75%, according to a central bank decision published in the official gazette.
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SWEDEN: Thedeen Talks Down Need of Hike at Next Meeting - Riksbank Minutes
Oct-02 08:04
- Overall, a relatively muted response in the SEK to the Riksbank minutes, but the currency is erring slightly weaker. The varied views of the board reflected in the release, acknowledging that while inflation "is on the way down", the underlying inflationary pressures are still too high.
- Some members more confident about the downtick in inflation, notably Governor Thedeen: "There are now clear signs that the rate of price increase is slowing down.", adding that the next hike "may not be at the next meeting; further tightening can come at a later stage"
- EUR/SEK edges slightly higher to new daily highs of 11.5765, but remains well short of Thursday's best levels at 11.6321. SEK shifts from being mid-table in G10 to among the weakest outside of the AUD.
BONDS: Gilt leads Bonds lower
Oct-02 08:01
- Gilt is leading here, hovers at its session lows, which helps Bund off its high.
- The Gilt/Bund spread is again widening, after testing its tightest level since May on the 22th September.
- Desks have favoured fading just ahead of the 150.00bps Psychological support, now back above 160.00bps at 163.00bps.
- Support for Gilt is at 92.72, last week's low.
Chart source: MNI/Bloomberg
SWEDEN: Muted Response to Riksbank Minutes
Oct-02 07:55
Relatively muted response in the SEK to the Riksbank minutes, but the currency is erring slightly weaker.
- The varied views of the board reflected in the release, acknowledging that while inflation "is on the way down", the underlying inflationary pressures are still too high".
- Some members more confident about the downtick inflation, notably Governor Thedeen: "There are now clear signs that the rate of price increase is slowing down."
- However, Thedeen also notes that further tightening is likely necessary, and "may not be at the next meeting; further tightening can come at a later stage".
- EUR/SEK edges slightly higher to new daily highs of 11.5763, but remains well short of Thursday's best levels at 11.6321. SEK shifts from being mid-table in G10 to among the weakest outside of the AUD.
