Latest news with #JoergKukies

Zawya

28-04-2025

Business
Zawya

Euro zone yields edge up as traders await economic data

Euro zone government bonds edged higher on Monday, as the unusual absence of U.S. tariff-related headlines left investors waiting for direction from economic data due later in the week. Germany's 10-year yield rose 3.5 basis points to 2.5%, but was still near the lower end of its recent range. The euro zone benchmark is trading roughly where it was in early March before the parties that are set to form the next German government announced a plan to massively ramp up borrowing and spending, sending the 10-year yield up to around 2.9%. It then dropped back, partly due to investors seeking the safety of German government debt after U.S. President Donald Trump announced his sweeping tariff plan. German spending was briefly back in focus again on Monday as Reuters reported, citing a letter from German Finance Minister Joerg Kukies, that the country has asked the European Commission for an exemption from European Union borrowing limits in order to increase defence spending in the coming years. But traders were generally in wait and see mode ahead of data due later in the week. In the U.S., there is PCE inflation and GDP numbers due on Wednesday, and nonfarm payrolls for April on Friday. Investors will inspect the data for evidence of the economic hit they expect from the disruption and uncertainty caused by tariffs, though this week's batch could be a little soon. That means markets currently expect the Federal Reserve to remain on hold at its meeting next week, but see roughly a two in three chance of a 25-basis-point rate cut in June. A sense that the labour market is deteriorating in this week's data would move money markets closer to fully pricing that June move, said Kenneth Broux, head of corporate research FX and rates at Societe Generale. In Europe, inflation data will be published, including in Spain on Tuesday, and Germany, France and Italy on Wednesday. Generally in-line prints would underscore investors' expectations the European Central Bank will continue cutting interest rates to support the euro zone economy. The latest example was policymaker Francois Villeroy de Galhau saying on Monday there was still margin for further interest rate cuts in Europe as inflation in the euro zone heads lower. Markets are currently pricing a 25-bp ECB rate cut in June, and at least one, maybe two further such moves this year. Italy's 10-year yield was 2 bps higher at 3.61%, and Germany's rate-sensitive two-year yield nudged up 1 bp to 1.75%.

Germany asks for EU leeway on defence spending, letter shows

Reuters

28-04-2025

Business
Reuters

Germany asks for EU leeway on defence spending, letter shows

BERLIN, April 28 (Reuters) - Germany has asked the European Commission for an exemption from European Union borrowing limits in order to increase defence spending in the coming years, according to a letter from German Finance Minister Joerg Kukies seen by Reuters on Monday. Kukies told Reuters in an interview on Friday that Germany was likely to request the exemption. The European Commission has proposed allowing member states to raise defence spending by 1.5% of gross domestic product (GDP) each year for four years without any disciplinary steps that would normally kick in once a deficit is above 3% of GDP. "We see the Commission's proposal for a coordinated activation of the National Escape Clause of the Stability and Growth Pact as an important complementary measure to enable increased national defence spending while safeguarding fiscal sustainability," Kukies said in the letter. The Commission had hoped the proposal would be widely taken up by the 27 EU countries and help boost EU defence investment by 650 billion euros over the next four years to deter potential Russian aggression. However, only Portugal and Poland had so far signalled interest in the exemption. EU countries with high national debt are sceptical of borrowing more to spend on defence. Germany's request may encourage other countries to follow the path, although its government debt ratio of 62.5% of GDP in 2024 is much lower than that of Italy, France and Spain, which are all above 100% and reluctant to apply for the exemption.

Germany likely to apply for EU leeway on defence spending, finmin says

Reuters

25-04-2025

Business
Reuters

Germany likely to apply for EU leeway on defence spending, finmin says

BERLIN, April 25 (Reuters) - Germany is likely to ask the European Commission for an exemption from European Union borrowing limits to increase defence spending in coming years without breaking EU rules, German Finance Minister Joerg Kukies told Reuters on Friday. "It looks likely that we may do that, but the final decision needs to be taken," Kukies said in an interview, adding that this is being discussed in the German government in coordination with the incoming parties. The European Commission has proposed allowing member states to raise defence spending by 1.5% of GDP each year for four years without any disciplinary steps that would normally kick in once a deficit is above 3% of GDP. Portugal has signalled it would ask for an exemption and Poland is likely to as well, Reuters reported on Thursday. The European Commission had hoped the proposal would be widely taken up by the 27 EU countries and help boost EU defence investment by 650 billion euros over the next four years to deter a potential Russian invasion.

Bloomberg

24-04-2025

Business
Bloomberg

Bloomberg Markets 04/24/2025

"Bloomberg Markets" follows the market moves across every global asset class and discusses the biggest issues for Wall Street. Today's guests; Germany Finance Minister Joerg Kukies, Envestneet Solutions Co-CIO and President Dana D'Auria, Citi Global Head of Commodities Research Max Layton, Wolfe Research Global Internet Managing Director Shweta Khajuria, and Van Eck Associates Senior Municipal Credit Analyst Tamara Lowin. (Source: Bloomberg)

Germany's Kukies Sees Zero Tariffs as Best EU-US Deal