ECB Has Won Battle Against Inflation in the Eurozone, Villeroy Say
The European Central Bank has succeeded in bringing inflation under control after a surge driven by the end of the Covid-19 pandemic and Russia's invasion of Ukraine, the head of France's central bank said Friday.
The ECB Thursday lowered its key interest rate to 2% from 2.25%, its eighth cut since June 2024. That move followed figures that showed the annual rate of inflation was 1.9% in May, below the ECB's 2% target.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Entrepreneur
21 minutes ago
- Entrepreneur
Are Stocks Stuck in a Trading Range?
After a big bounce from the April bottom stocks are having a hard time breaking above 6,000 for the S&P 500. Why is that? And what happens next for stocks?... This story originally appeared on WallStreetZen We have enjoyed a tremendous bounce from the bottom of the April correction. Now it seems we are just a stone's throw away from the all time highs at 6,147. Yet I think it will take a lot more proof of success on tariffs for that to happen. Meaning we have really been stuck in limbo since mid May when took our first shot at breaking above the psychologically important 6,000 level. Since then, we have traded in a narrow range on the ebb and flow of the tariff headlines. My point is that this trading range will likely be in place til investors have more conviction on the final outcome of these plans that could dramatically effect inflation and the odds of recession. We will talk more about that in the June commentary shared below. Market Commentary Here is the most recent picture of the S&P 500 where the current trading range becomes a lot more evident. After flirting with bear market territory in early April we enjoyed a tremendous bounce culminating in the May 12th bullish breakout back above the 200 day moving average (red line). Since then stocks kept moving a notch higher as the tide of tariff stories turned more positive. But then investors started to realize that the 'outline' of a deal with China is different than a finalized deal. Plus, there are at least 10 other major trade deals that need to be hammered out to create a bit more calm such as with Mexico, Canada and the EU. More and more investors believe this is just 2018/19 revisited. Meaning that the trade wars we engaged with back then started with 2 sides very far apart (namely the US and China). Then as time rolled on each side became more open to reasonable compromises. The net result was a return to bullish conditions after an extended correction. Now with investors once again used to Trump's 'unique' negotiating style the odds point to the same being the case here. Yet they are not so certain of that outcome to take out the previous high of 6,147. This points to the formation of a trading range giving investors time to see what comes next. That range is framed on the low side by the 200 day moving average currently @ 5,790 and the psychologically important 6,000 level that we have been stuck below since mid May. In my May 21st Zen Investor webinar I talked in-depth about the risks still out there with tariffs and potential recession. In essence the better those things are sooner we take off on a bullish run above 6,000 followed by a break out to new highs above 6,147. Or simply stated, the bull market would be back on with probably another 2-3 years of upside on left on the clock. Conversely, if the worst feared outcomes for tariffs comes to fruition, then we are looking at likely higher inflation and potential recession. Obviously, these outcomes would result in further weakness for stocks. If just inflation, then maybe retreat towards the April lows of 4,800. If recession, then expect bear market with lows closer to 4,000. Gladly I still see the bullish outcome as the more likely as Trump has shown enough cards that his tariff demands are not really as extreme as first appeared. Some investors are calling this the TACO trade. Trump Always Chickens Out That is an amusing term that is certainly getting its fair share of laughs. However, I think its misstated. It's not chickening out if you never intended to follow through on the threats. It's just part of his negotiating style. Like lowballing someone on the purchase of a house to see if it weakens their position on what they take as the final offer. Clearly most investors have skewed the odds in favor of return to bullish conditions given how we are so much closer to the highs than the recent lows. But again, this is a logical time for folks to press pause and see what happens next before the next major move for stocks. Our investment plan in the short run with a likely trading range at hand is to appreciate that the average stock may be our goal is to own better than average stocks ( stocks!) thanks to the 115 factor review of the Zen Ratings. So, I like our odds to outperform during this holding pattern for the broader market. Note that on the other side of this I still say bull market and new highs is most likely. That is why the majority of our portfolio is Risk On growth stocks with the most upside potential. However, we have just enough defensive/conservative positions sprinkled in to reduce the volatility in our portfolio if things get rough once again. All in all, I think we are properly aligned with current market conditions and ready to skew more bullish or bearish depending on how things proceed on the tariff front. What To Do Next? Discover the Zen Investor service that relies upon my 45 years of investing experience. During that time I have learned vital lessons from 7 bear markets…8 bull markets and just about everything else the 'Mr. Market' can throw at us. I use this knowledge to create a detailed investment plan. Then lean into our proven Zen Ratings quant model to select the best stocks given their average annual return of +32.52%. In total the Zen Investor portfolio now has 20 top stocks that are hand picked for today's unique market landscape. That includes 2 new stocks added in early June with stellar upside potential. If you are curious to learn more, and want to see my current top stocks, then please click the link below to get started now. Discover the Zen Investor & Top Stocks > Wishing you a world of investment success! Steve Reitmeister…but everyone calls me Reity (pronounced 'Righty') Editor of the Zen Investor What to Do Next?
Bloomberg
38 minutes ago
- Bloomberg
Austria Rating Cut to Record Low by Fitch as Budget Woes Persist
Austria 's sovereign credit was cut by Fitch Ratings to two steps below the top mark for the first time, handing the government another setback in its bid to repair the country's finances. Fitch lowered Austria's rating to AA with a stable outlook from AA+, according to a statement Friday. Austria's deficit was higher than forecast 'driven by a worse economic environment and overspending at the local government and municipality level,' the ratings firm said.
Yahoo
an hour ago
- Yahoo
Trump urges Fed's Powell to cut interest rates by full percentage point: 'Rocket Fuel!'
President Donald Trump on Friday called on Federal Reserve Chairman Jerome Powell to lower interest rates by a full percentage point. "'Too Late' at the Fed is a disaster!" Trump wrote in a post on Truth Social. "Europe has had 10 rate cuts, we have had none. Despite him, our Country is doing great. Go for a full point, Rocket Fuel!" Trump's post came after the release of the Labor Department's May employment report, which showed the U.S. economy added 139,000 jobs in the month. The figure was stronger than the estimate of economists polled by LSEG, who projected a gain of 130,000 jobs, but cooler than the downwardly revised increase of 147,000 jobs added in April. Job Growth Continued To Slow In May Amid Economic Uncertainty The president's comments also follow the European Central Bank's (ECB) decision to cut interest rates on Thursday. The ECB has now lowered borrowing costs eight times, or by 2 percentage points, since last June, seeking to prop up a eurozone economy that was struggling even before erratic U.S. economic and trade policies dealt it further blows. Read On The Fox Business App With inflation now safely in line with its 2% target and the cut well-flagged, the focus has shifted to the ECB's message about the path ahead, especially since at 2%, rates are now in the "neutral" range where they neither stimulate nor slow growth. Ecb Cuts Rates As Bets Build On A Summer Pause The president, in a separate Truth Social post on Friday, said cutting interest rates would allow the U.S. to reduce short- and long-term interest rates on debt that is "coming due." "If 'Too Late' at the Fed would CUT, we would greatly reduce interest rates, long and short, on debt that is coming due," Trump wrote. "Biden went mostly short term. There is virtually no inflation (anymore), but if it should come back, RAISE "RATE" TO COUNTER. Very Simple!!! He is costing our Country a fortune. Borrowing costs should be MUCH LOWER!!!" The market currently expects a near-zero chance of a rate cut after the Fed's next meeting on June 17-18, according to the CME FedWatch tool. Trump most recently demanded Powell to lower interest rates on Wednesday, after ADP reported companies in the private sector added just 37,000 jobs in May. The figure was the lowest since March 2023. Reuters contributed to this article source: Trump urges Fed's Powell to cut interest rates by full percentage point: 'Rocket Fuel!' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
