Bi-Weekly Report 18 April-1 May 2017


The CBRT proceeded with a further 50 bp hike to its main monetary policy instrument

Fiscal easing improved in Q1:17, ahead of the mid-April referendum



Credit expansion picked up slightly in Q1:17, but remains relatively moderate

Deposit growth maintained its strong momentum in Q1:17, underpinned by strong economic activity

The real estate market continued to improve in Q1:17



A weak coalition emerged from the March 26th parliamentary elections

Credit expansion strengthened in Q1:17

Customer deposits gained momentum in Q1:17, due to solid economic growth



External rebalancing continued in FY:16, with the current account deficit easing to a multi-year low of 4.0%, supported by favourable energy prices and buoyant exports



The political crisis took a turn for the worse in the form of "goon" intimidation tactics within the Parliament chamber

The fiscal deficit narrowed to 2.3% of GDP in Q1:17 from 2.6% in Q4:16, on a 4-quarter rolling basis

Customer deposit growth slowed further in Q1:17 as the domestic political impasse enters its third year



European Parliament mediation failed to end the domestic political deadlock

The current account deficit narrowed to a 10-year low of 9.5% of GDP in FY:16, mainly due to strong tourism inflows



Tourism activity declined slightly in Q1:17, due to increasing competition from neighbouring Egypt

Customer deposits gained momentum in Q1:17, mainly supported by non-residents



Significant fiscal consolidation in the first seven months of the fiscal year, mainly due to a favourable wage bill


Appendix: Financial Markets

Bi-Weekly Report 18 April-1 May 2017