Turkey makes downward revision to GDP forecasts

The Turkish government has cut its growth forecasts, as part of its new Medium-Term Program. The latest forecasts show GDP expanding at a rate of 3.3% in 2025 and 3.8% in 2026, down from 4% and 4.5%, respectively. Estimates of the budget deficit have also been raised to 3.6% of GDP, from 3.0% previously, with higher spending in part due to earthquake reconstruction costs.

German industrial production rose 1.3% m/m in July, beating consensus expectations for a 1% gain. The outturn was the first gain since March, while the June print was revised up to a 0.1% decline. The improvement was due to a rise in machinery and equipment.

Today’s Economic Data and Events

10:45 FR industrial production (Jul). Forecast: -1.4% m/m

18:00 US payrolls revisions

Fixed Income

• US Treasuries saw further gains on Monday. The 2yr yield declined 2bps to reach 3.4863%, while the 10yr yield fell 4bps to 4.0398%.
• There were declines across major European bond yields, with the 10yr Gilt falling 4bps to 4.603%.
• PIF has mandated banks for a USD 10yr benchmark issuance, priced at T+95.

FX

• The dollar fell for a second day with the spot index declining 0.3%. EURUSD gained 0.4% to 1.1763, GBPUSD rose 0.3% to 1.3545 and USDCHF fell 0.6% to 0.7933.
• In emerging markets, USDTRY was broadly flat at 41.2371, USDZAR fell 0.5% to 17.4953 and USDEGP fell 0.7% to 48.2434.

Equities

• Major US equity markets gained on Monday, driven by rising tech stocks. The Dow Jones rose 0.3%, the S&P 500 gained 0.2%, and the NASDAQ increased by 0.5%.
• European equity markets rose on the day, despite a vote of no confidence against the French Prime Minister, Francois Bayou. The Eurostoxx 50 rose 0.8%, the FTSE 100 increased by 0.1%, the CAC 40 gained 0.8% and the DAX rose 0.9%.
• Locally, the DFM fell 0.9%, while the ADX declined by 1%. The Tadawul fell 0.9%.

Commodities

• Oil prices steadied on Monday after Sunday’s OPEC+ announcement Brent futures rose 0.8% to USD 66.02/b. and WTI gained 0.6% to 62.26/b.
• Gold prices saw further gains, rising 1.4%, to 3,635.98 /troy oz, fueled by prospects of a Fed rate cut.