Tag: Europe

Shadow banks are growing quickly across the euro zone and represent a growing risk to the entire financial system, requiring lenders to be more stringent when dealing with such entities, European Central Bank supervisor Andrea Enria said.

European markets fell at the start of the new trading week as investors remained jittery over the economic outlook. The benchmark Stoxx 600 index was 0.7% lower shortly before midday London time, with most sectors declining. Chemicals stocks led losses, down 2.1%, as banks eked out a 0.16% gain.

Retail sales in the eurozone flatlined in April, a weaker result than expected, as high inflation and fears of an economic slowdown continue to weigh on household spending.

The lower revision was already predicated by the earlier readings. All of this just points to a slowdown in momentum in euro area services activity.

Inflation in the euro zone eased more than expected in May, with flash figures showing the bloc’s annual headline inflation rate fell to 6.1% in May from 7% in April.

Financial markets could face a sharp downturn in the event of any further shocks to the global economy, European Central Bank Vice-President Luis de Guindos told CNBC on Wednesday.

Confidence among businesses and consumers in the eurozone sank in May by more than expected, indicating that the economic revival after 2022’s energy-price shock has started to fade.

A digital euro could be launched in three or four years but banknotes will be available as long as there is demand for them, Fabio Panetta, a member of the European Central Bank’s Executive Board, told Les Echos.

The contrast between the services and manufacturing readings were already outlined earlier by the French and German reports.

The European Central Bank will have to keep raising interest further to bring inflation back to its mid-term goal of 2% though most of the tightening has already been done, ECB’s Vice President Luis de Guindos said on Thursday.