Economy

Lufthansa pilot strikes
Notice of strike at Lufthansa and Eurowings

The German pilot union Vereinigung Cockpit (VC) is taking its members within the Lufthansa group on strike on Monday and Tuesday, international media reports. In addition to Lufthansa, the strike also applies to subsidiaries Cityline and Eurowings.

VC states that it feels forced to strike because the employer “has not shown any noticeable willingness to find a solution” regarding salaries and pensions, says chairman Andreas Pinheiro according to Die Welt.

Lufthansa is incomprehensible to the criticism and calls VC’s actions “a whole new level of escalation”.

The pilots at Lufthansa went on strike as recently as March this year, writes AFP. 

Middle East Crisis Economic Impact
Analysis: Slowing Down – Too Early to Breathe

The market’s tepid reaction to Friday’s sharp rise in the US CPI suggests that investors believe that the inflation peak is near – but it is too early to draw that conclusion, writes Bloomberg’s Jonathan Levin.

“Usually, when you get a report this bad, more like it are waiting around the corner,” he writes. Historically, sharp inflation increases have often come in clusters, especially in connection with wars and other geopolitical shocks. It also takes months for the energy price shock to have an impact on the entire economy, which also showed signs of weakness even before the war.

Inflation is likely to be elevated well into the second half of the year and cause the Fed to wait and see with the interest rate – with the risk of, for example, the housing market cracking, writes Levin.

DI’s Nils Åkesson also emphasizes the importance of following the spillover effects of the oil shock. “How quickly and how much of the price wave is passed on will be crucial for the central bank,” he writes. If the surge in inflation stops at energy, the Fed can focus on risks to a cooler labor market. But any signs of spillover effects increase the risk that the planned interest rate cut will have to be postponed, Åkesson writes.

The election in Hungary
Expert on the fateful election: “We have reached a dead end”

Hungary’s economy is in a critical situation ahead of this weekend’s fateful election. Low growth, high national debt and frozen EU funds are pressuring the country after years of corruption and political conflicts under Viktor Orbán. That is the opinion of the country’s former central bank governor Péter Ákos Bod.

– Economically, we have reached a dead end, he tells Dagens Industri.

Without a change of power, the country risks being immediately thrown into financial turbulence, he warns. An opposition victory, however, could release EU support and provide some recovery, according to economist Éva Palócz.