Cypriot Banks to Re-open
All commercial banks in Cyprus are due to open their doors today – in many cases for the first time in 12 days. An official from the Central Bank of Cyprus has already announced some measures intended to restrict transactional activities. These are not likely to prevent a bank run, but should at least slow the pace of deposit withdrawals. Daily withdrawals will be limited to EUR 300, but domestic credit card transactions will not be restricted it seems. European media have leaked further details – reports suggest that the cashing of cheques will be forbidden (although cheques can still be deposited in bank accounts if the bearer so chooses). Transactions in excess of EUR 5000 are to require central bank approval. Trade is likely to be badly affected but importers can still make international payments on submission of a genuine invoice. The euro continues to look vulnerable against the Cypriot backdrop, ongoing political uncertainty in Italy, and the weak economic outlook across the Eurozone.
Click here to read the full report: UBS
UBS