Greece reopened its banks and ordered billions of euros owed to international creditors to be repaid on Monday in the first signs of a return to a normal way of life. Increases in value added tax agreed under the bailout terms also took effect, with VAT on processed food and public transport jumping to 23 percent from 13 percent.
However stock market remained closed until further notice. Limits on withdrawals will remain at 420 euros per week instead of 60 euros per day as well as payments and wire transfers abroad will still not be possible. Greece yesterday initiated a payment of 4.2 billion euros in principal and interest to the European Central Bank due on Monday after European authorities agreed last week to provide emergency funding assistance. It is also paid 2.05 billion euros to the International Monetary Fund in arrears since June 30.
Some officials in government have suggested that if support from lawmakers from within the coalition dropped below 120 votes, early elections would have to be called while the bailout was still being negotiated. The bailout terms, which are tougher than those rejected in a referendum earlier in July, include tax hikes, pension cuts, strict curbs on public spending, an overhaul of collective bargaining rules and a transfer of 50 billion euros of state assets into a special privatisation fund.
House prices are rising rapidly in the north east of England and falling fast in Kensington and Chelsea, according to property website Rightmove, in a remarkable reversal of the trend over the past decade. In the London borough of Kensington and Chelsea, the average asking price for a property fell by more than £178,000 to £2.29m during July, a decline of 7.2%. But in the north-east, prices rose by 2.1% over the month, to £147,251. The region recorded the biggest rise in asking prices of any part of the UK.
A top Fed official told reporters on Monday that there is a better than 50 percent chance that the Federal Reserve will raise interest rates in September.St. Louis Fed President James Bullard stated that the Fed should get ahead of the curve, as inflation will rise and labour market slack will end.
Bullard, who is not a voting member on the Fed's policy-setting committee this year, is a policy hawk who previously said the Fed has kept rates at near-zero levels for too long. Bullard said the Fed's meeting next week might be a little early for a move and the central bankers will use that time to "assess" the data.
09:30 – GBP: UK Public Sector Borrowing expected to decrease from £9.35Bn to £8.6bn in June