Global Market Reviews

Hungarian and Polish central bankers will decide on monetary policy next week, and while no change is expected in Warsaw, Budapest’s policy makers are poised to cut interest rates.

Analysts and financial markets both expect monetary easing in Hungary Monday. All 16 private bank economists polled by Dow Jones Newswires see the Hungarian Monetary Policy Council lowering the policy rate from 9.5%, the highest in the European Union. And 13 of them expect a 50 basis-point rate cut, while the others foreseeing that or a 25 basis-point cut.

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The euro zone’s economic contraction slowed more than expected in July, but an acceleration in the decline of French output suggested the currency area’s recovery from the deepest recession since World War II is likely to be gradual.

The flash reading of the euro zone’s composite output index, a closely watched gauge of private-sector activity, rose to a 10-month high of 46.8 in
July from 44.6 in June, Markit Economics said Friday.

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