SEE equities

SEE markets shrug off concerns about inflation, rising gas prices

From 25-29/07/2022

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Stocks in South East Europe (SEE) gained ground this week, boosted by data showing that the eurozone economy expanded at a higher-than-expected rate of 0.7% in the second quarter, compared with the previous quarter. Athens led the gains in the SEE region with the General Index jumping 2.54%, followed by Bucharest where the blue-chip BET advanced 2.11%.

Markets largely shrugged off concerns about inflation hitting record 8.9% in July in the 19 countries using the euro. Slovenia had the sixth highest inflation rate in the eurozone (11.7%), with the highest rate recorded in Estonia (22.7%) and the lowest in Malta (6.5%), Eurostat data showed. At levels similar to those of Slovenia, the harmonized consumer price index was just about matched in Greece (11.5%). In Cyprus annual inflation hit 10.6%. Looking at the main components of eurozone’s inflation, energy had the highest annual rate in July (39.7%, compared with 42.0% in June).

Speaking of energy, European natural gas prices rose after Russia reduced gas supplies from the Nord Stream pipeline to 20% of capacity, citing the need for maintenance on another turbine. Of note, Russia put Croatia, Slovenia, Greece on list of ‘unfriendly countries.’

In Bosnia, inflation jumped to 15.8% year-over-year in June, with the central bank projecting 12% average annual inflation in the January – September period. Meanwhile, Moody’s affirmed Bosnia’s B3 ratings. The outlook remains stable

In Romania, financial analysts part of CFA Romania association see the rate of inflation reaching an average value of 11%, a new all-time high since the launch of the monthly poll CFA has conducted for over ten years. They also expect the Romanian leu to drop to an average exchange rate of 5.1121 units/EUR in the next 12 months.

In politics, Bulgaria heads for snap vote after Socialists failed to form cabinet.


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kbalkoudi@worldmarketsdaily.com

Kyriaki Balkoudi is a markets editor for World Markets Daily. She holds a bachelor’s degree in Balkans Studies from Aristotle University of Thessaloniki, Greece and a master’s degree in International Politics from City University London, UK.


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