Top of the agenda: what you can't miss in the economy and markets this week

In the next two days, until Tuesday, the Prime Minister, António Costa, will have a series of meetings with the various political parties to discuss the economic and social stabilization program, in order to ascertain its impact on the Budget.

Omer Messinger / EPA

Supplementary budget: Costa meets with parties

The Government starts this Monday to work on the supplementary Budget that will be presented to the Assembly of the Republic in June. In the next two days, until Tuesday, the Prime Minister, António Costa, will have a series of meetings with the various political parties to discuss the economic and social stabilization program, in order to ascertain its impact on the Budget.

António Costa starts the meetings with the parties on the left, having scheduled for this Monday meetings with the PCP (09h30), PEV (12h00), Be (14h30) and PAN (17h30).

The meetings with the parties occur after the President of the Republic, Marcelo Rebelo de Sousa, has called for political consensus for the document. Last week, António Costa explained that, intending to listen to political parties, he intends to evaluate the measures that will be necessary to stimulate the economy, namely, support for companies, employment and people's income.

ECB members discuss Europe's challenges because of Covid-19

Two members of the executive board of the European Central Bank will participate in the conference call “IIF European Conference: The EU, COVID-19 and the Future of Financial Services” which, between Tuesday and Wednesday, will address the main challenges that are fading on Europe due to the Covid-19 crisis.

On Tuesday, analysts and markets will pay attention to Irish economist Phillip Lane and the next day to Andrea Enria's speech.

European Commission presents EU budget proposal

This Wednesday the European Commission will present the proposals for the European Union's multi-annual budget, which will run from 2021 to 2027. And, in addition, the institution led by Ursula von der Leyen will take an important step in the European fight against the economic effects from Covid-19, when also presenting proposals on the € 500 billion Recovery Fund, announced last week by France and Germany.

All 27 Member States will have to give the Fund the green light for it to run. This weekend, the debate over the Franco-German proposal gained new obstacles after Austria, Denmark, the Netherlands and Sweden refused to use debt-mutual instruments and are still against European aid in form of non-repayable subsidies without the most affected countries making adjustments in return. They are also against an increase in national contributions to the Community budget.

Second United States first quarter GDP estimate

On Thursday, the second US GDP estimate for the first quarter of the year will be released. Market projections anticipate that the world's largest economy has contracted more than initially projected. Preliminary estimates pointed to an annualized GDP contraction of 4,8% in the first three months of the year, which was the biggest drop since the last quarter of 2008.

What really happened to the Portuguese economy in the first three months of the year?

The National Statistics Institute (INE) will present the national accounts for the first quarter of 2020 this Friday, offering more information on the impact of Covid-19 on Portuguese GDP. According to INE's quick estimate, released in May, national GDP fell 2,4% in the first three months of the year compared to the same period in 2019.

The main highlights of this week:

Monday:

  • Prime Minister, António Costa, starts two days of meetings with political parties to discuss measures to support the economy that will be reflected in the supplementary Budget;
  • Germany's GDP released in the first quarter of the year;
  • Wall Street is closed due to 'Memorial Day'.

Tuesday:

  • Speech by ECB member Phillip Lane at the “IIF European Conference: The EU, COVID-19 and the Future of Financial Services”;
  • ECB Financial Stability Report released.

Wednesday:

  • European Commission adopts and presents proposals on the European Union's multi-annual budget 2021-2027 and on the Recovery Fund for the EUR 500 billion economy;
  • Speech by ECB member Andrea Enria at the “IIF European Conference: The EU, COVID-19 and the Future of Financial Services”.

Thursday:

  • Semapa presents results for the first quarter of 2020;
  • Second United States GDP estimate for the first quarter released;
  • Presented the number of applications for unemployment benefits in the United States last week;
  • Eurozone Sentiment of Confidence Released for May.

Friday:

  • INE publishes quarterly national accounts for the first quarter of 2020;
  • Euro zone inflation rate for May released.
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