Contributions for unemployed paid by employers to be abolished in 2019 – Mali announces incentives for economy
Serbian Finance Minister Sinisa Mali announced that contributions for the unemployed paid by employers in the amount of 0.75% would be abolished from January 1, 2019, whereby the total income burden is reduced from 63% to 62%. We thereby send a message to business people and investors that we are striving for income burden to be as small possible, for us to be as competitive as possible and to thereby motivate new employments in Serbia – Mali said at a press conference. By the end of October, he said, a new draft law on fees will be defined, under consent of the IMF, and certain parafiscal charges will be abolished as well.
NBS sells 30 mln euros, euro rate RSD 118.46
The National Bank of Serbia (NBS) sold 30 mln euros on the interbank foreign exchange market, making Thursday's official median exchange rate against the euro 118.4609 dinars, which is a slight change from Wednesday, the NBS said in a statement. The dinar was ta 2019 low against the euro on Thursday. The NBS has sold a total 100 mln euros on the interbank foreign exchange market since the beginning of the year to curb excessive daily exchange rate fluctuations. The dinar dropped 0.3 pct against the dollar m-o-m, declining 7.6 pct y-o-y and 0.7 pct relative to the beginning of the year.
Serbia to get new railway dispatch centre by 2021
Serbia will get a new, leading-edge railway dispatch centre by 2021 and three Belgrade sites are being considered as its future location, Serbian Minister of Construction, Transport and Infrastructure Zorana Mihajlovic said Thursday. The centre will be the most modern dispatch centre in this part of Europe, said Mihajlovic, adding that a 1 bln dollar Russian loan had been agreed, with half of the funds already drawn.
Early election would cost 20mln euro and would postpone reforms
Holding early elections in spring in Serbia would leave unfavourable short-term and long-term consequences for the budget and economic growth in the country – most economists agree. However, a Belgrade Faculty of Economics professor, Milojko Arsic says, for the Beta news wire, that “the elections would have no significant impact on economic growth this year, which will range from 3.5% to 4%, because the election campaign is likely to last very shortly, and the economic policy for this year is already adopted.” According to him, Serbia’s economy lagging behind the CEE countries cannot be justified by fiscal consolidation or unfavourable weather conditions, since other countries, in this period also implemented fiscal consolidation and were faced with the same bad weather. Chief Economist of the Fiscal Council of Serbia, Danko Brcerevic, told Beta that the immediate effect of early elections would be a budget cost of around 20 million euro. The long-term consequences of early elections are, according to him, postponing the creation of a salary-band system that should have been completed in 2018. However, it has been postponed for 2019, and if the elections do take place, the current uncertainty will continue.
Dow falls after Commerce Secretary says US, China still far away on trade deal, Europe closes mixed as US-China trade developments weigh, ECB holds rates
The Dow Jones Industrial Average fell on Thursday amid lingering concern over U.S.-China trade negotiations. The 30-stock index dipped 21 points, led by losses in Merck and Pfizer. The S&P 500 eked out a 0.1 percent gain as chip stocks lifted the technology sector. The Nasdaq Composite outperformed, rising 0.68 percent.
Commerce Secretary Wilbur Ross said earlier on Thursday that China and the U.S. were not close to striking a trade deal. Ross told CNBC’s “Squawk Box ” that the U.S. is “miles and miles ” from a trade deal with China, adding the two countries have “lots and lots of issues.”
American Airlines and JetBlue were among the companies that posted better-than-expected earnings. Texas Instruments also topped estimates. American Airlines and JetBlue both rose more than 5 percent. Texas Instruments surged 6.9 percent.
For now, the U.S. labor market appears to be holding up well. Weekly jobless claims fell to 199,000 last week, their lowest in 49 years.
European stocks closed in mixed territory after renewed pressure during Thursday’s afternoon deals, as investors digested the latest political and central banking news. The pan-European Stoxx 600 closed in positive, up 0.25 percent in afternoon trade.
Looking at Europe’s corporate space, technology sector closed more than 2 percent higher. The industry was given a boost after STMicroelectronics earnings were published.
In autos, Renault came off its highs, but closed in the black after the automaker confirmed that the appointment of its new chairman, Jean-Dominique Senard and its new chief executive, Thierry Bollore. Earlier on in the day, French finance minister Bruno Le Maire said in an interview that embattled executive Carlos Ghosn had resigned from Renault.
Elsewhere, markets in Europe have been tuning into the latest news coming out of the European Central Bank. On Thursday, the central bank decided that it wouldn’t take any action, opting to hold fire on its benchmark interest rates.