Headlines

The euro zone economy has kicked off the year robustly, data from the Baltic to the Mediterranean showed on Monday, evidence for the European Central Bank that its massive cash stimulus is working but also posing questions about what comes next. There are risks ahead - some economic, some political - but for now the 19 member states of the euro zone are doing better than many expected, the International New York Times reported on a Reuters story.

The premium investors demand to own two-year French debt over similarly maturing German bonds climbed to its highest level since the 2013 Taper Tantrum on Monday, as the country’s election looms, the Financial Times reported. The difference between yields on two-year French and German sovereign bonds climbed to 25 basis points on Monday, up from 18.5 bps on Friday and a low of less than 1 bp touched after the US election last November. Yields on the French note climbed 5 bps on Monday, compared to a 2 bp drop in German ones.

Greece’s public debt and financing needs will prove “explosive” in decades to come unless Europe overhauls its bailout program to ease the load, the International Monetary Fund says in a draft report as the country seeks a fresh loan payout, Bloomberg News reported. In a baseline scenario, Greece’s government debt will reach 275 percent of its gross domestic product by 2060, at which time its gross financing needs will represent 62 percent of GDP, the IMF says in the report obtained by Bloomberg. The government estimates public debt around 180 percent of GDP at present.

The largest shareholder in Oi SA will oppose any alternate reorganization plan that does not come from within the debt-laden Brazilian phone carrier, which is struggling to emerge from bankruptcy protection. In a statement sent to Reuters on Friday, Portugal's Pharol SGPS SA said it will only endorse alternatives to Oi's original reorganization proposal if the carrier's board approves changes. The statement specifically referred to a proposal made by billionaire Paul Singer's Elliott Management Corp this week.

A Chinese phone maker’s failure to repay around $166 million in bonds has rippled through the world’s largest internet investment marketplace, hitting investors who hadn’t even bought the securities, The Wall Street Journal reported. The default, by phone maker Cosun Group, is one of the most high-profile failures to hit China’s sprawling network of Internet-based financial firms. It is an embarrassment to Alibaba Group Holding Ltd.

Two historic Greek newspapers, including the country’s best-selling daily, will cease publication, the debt-ridden Lambrakis Press Group announced on Saturday. “To Vima weekly and Ta Nea daily are forced to cease their publication within days due to financial reasons,” the company said in a statement, The Guardian reported. Lambrakis Press Group (DOL) “is lacking any available resources and as a result it can’t support the printing of its newspapers and, of course, can’t ensure the unhampered operation of the other media outlets it owns,” it added.

Sri Lanka's public debt repayments will grow to a record $4 billion in 2019, the finance ministry said, blaming "colossal borrowing" by the previous government, Reuters reported. "Sri Lanka is embroiled in a gigantic debt trap," Finance Minister Ravi Karunanayake said in a statement. The cost of repaying and servicing foreign-held debt will jump more than 32 percent this year to $2.42 billion from 2016's 1.83 billion, rising to $2.56 billion next year, it said.

The number of people declared insolvent in England and Wales rose last year for the first time since 2010, after hitting a post-financial crisis low in 2015, official figures showed on Friday, raising concern about households' financial health. Britain's economy was the fastest-growing major advanced economy last year, despite initial fears that June's Brexit vote would lead to an immediate downturn. But it has become increasingly reliant on rising consumer borrowing.

Brazil's federal government and Rio de Janeiro state have agreed on a package of austerity measures that will partially plug the financially struggling state's anticipated $8 billion deficit. The federal government offered Thursday to defer the state's debt payments for up to three years, in exchange for spending cuts and tax increases, The New Zealand Herald reported on a Reuters story. Finance Minister Henrique Meirelles told a news conference the measures would yield around $6 billion in total. They include nearly $3 billion in spending cuts.

Greece hopes stronger than expected public accounts in 2016 will convince its lenders to sign off on a bailout review without demanding more austerity, government officials said on Thursday, the International New York Times reported. After meeting his euro zone counterparts in Brussels, Finance Minister Euclid Tsakalotos said that last year's primary surplus - which excludes debt servicing costs - reached 2 percent of gross domestic product, beating a target of 0.5 percent of GDP set in its bailout plan.