Economy

ECB vs. inflation
EMU inflation slows down unexpectedly – ​​below ECB target

EMU inflation measured as CPI slowed to 1.9 percent in May, preliminary figures from the statistical office Eurostat show.

The decline was unexpectedly large and came in below the ECB's target. It is the first time since September last year that inflation has fallen below 2 percent. percent.

On Thursday, the ECB is almost certainly expected to lower the deposit rate by 25 basis points to 2.0 percent, before holding off.

The question investors are asking is what the inflation announcement means for the ECB's interest rate path, writes Reuters.

SEB's Robert Bergqvist believes that it is now a given that the ECB will overtake the Riksbank on Thursday:

"Today's positive inflation figure provides a tailwind for the interest rate doves," he writes on X.

Unemployment amounted to 6.2 percent, which was in line with expectations.

Political situation in the Czech Republic
Czech minister accepted bitcoin - lost confidence

The opposition party Ano in the Czech Republic is planning to bring a vote of no confidence against the government. This after the justice minister resigned after accepting a gift in bitcoin worth $45 million on behalf of the ministry from a previously convicted person. This is according to opposition leader Karel Havlicek, according to Reuters.

Justice Minister Pavel Blacek denies that he did anything illegal by accepting the gift, which was later returned to its former owner.

- Unless something completely exceptional happens, we will call for a vote of confidence, Havlicek says on Czech television.

Swedish interest rates
Thedéen defends strategy: “Reasonable and well-balanced”

Riksbank Governor Erik Thedéen defends the central bank’s choice of interest rate policy last year.

– I believe that the fact that inflation stabilized near our target is an indication that the monetary policy we pursued in 2023 and 2024 was reasonable and well-balanced, he said during a hearing in the 

Riksdag’s Finance Committee.

The Riksbank is criticized: “Lowered too late”

The Riksbank lowered the interest rate too late and should also have lowered it in June last year. This is what researchers write in the report Swedish Monetary Policy 2024 from the Center for Monetary Policy and Financial Stability (Cemof) at Stockholm University.

Roine Vestman, director of Cemof, tells EFN that the economy had weakened before the June meeting. At the same time, inflation was expected to be below target and then there is no reason to wait to lower it.

– Then there is no trade-off for the Riksbank, because then it is the lowering that matters, he says.

Thedéen emphasizes, among other things, that the Riksbank began its interest rate cuts earlier than many other central banks. The fact that the interest rate has not been lowered at a faster pace has also proven wise because inflation in early 2025 has been somewhat higher than expected.

In a report that the Center for Monetary Policy and Financial Stability has produced for the Finance Committee, the decision to wait with continued cuts has, however, been questioned.

EU-China relations
China rages against EU restrictions

A Chinese business association warns that relations with the EU could deteriorate after the EU introduced rules that make it more difficult for Chinese healthcare companies to participate in public procurement in the region, writes Bloomberg.

The organization expresses "deep disappointment" and believes that the measure sends a negative signal that contradicts the EU's principles of openness and fairness.

The move comes at a sensitive time when China is trying to get closer to the EU while Donald Trump is pressuring the union elsewhere, according to the news agency.

US growth
Expert: Trump's "revenge tax" could lower the dollar and the stock market

A tax in Donald Trump's budget proposal risks lowering the dollar and triggering a sharp decline on Wall Street. This is predicted by Allianz CEO Ludovic Subran, according to CNBC.

The tax proposal in question involves increased taxes for individuals and companies from certain other countries and flies under the radar of many investors, says Subran.

If the proposal becomes reality, he predicts a stock market crash of 10 percent, a weakening of the dollar by 5 percent and an increase of half a percentage point in US long-term interest rates.

- I do not think that the markets are currently fully pricing in the introduction of the proposal, it could really scare the market, he says.

The so-called revenge tax was buried deep in Trump's "big beautiful bill" in section 899