European markets weaker as investors digest inflation data; Deutsche Bank slips 2% – CNBC
Europe’s major indexes were mixed on Monday, as investors digested inflation data from some of the region’s biggest economies on a quiet day due to holidays in the U.K. and U.S.
Germany’s DAX was trading 0.24% lower at 15,481 at around 11:45 a.m. local time, after hitting an all-time high the previous week. France’s CAC was largely flat, trading at 6,488 at the same time in Paris.
Switzerland’s SMI was also flat, as was Italy’s FTSE MIB, up just 0.3% at 25,249. It is a bank holiday in the U.K. with the FTSE 100 closed.
The German index was weighed down by Deutsche Bank, whose share price was trading in negative territory, down nearly 2% after reports that the U.S. Federal Reserve said it was concerned about the German lender’s anti-money laundering practices.
Also on Monday, inflation data was published for countries including Spain, which saw its highest inflation reading in four years. Consumer prices rose 2.4% in May year-on-year according to flash data from the country’s National Statistics Institute.
Meanwhile, France on Monday begins Covid-19 vaccinations for everyone over the age of 18.
Meanwhile, U.S. markets are closed for Memorial Day weekend.
OECD ups forecasts
The OECD’s latest Economic Outlook, published Monday, brought some good news for the euro area. Its report, entitled “No Ordinary Recovery,” said the global economic outlook is brightening, but in a very uneven way. For the global outlook overall, the organization sees a 5.8% growth in gross domestic product (GDP) in 2021, compared to a 3.5% contraction in 2020. It forecasts a 6.3% growth for the G20 group of developed economies, and 4.3% for the Euro area.
It added, however, that despite encouraging signs in health and economic recovery, there remain some significant headwinds, namely not enough vaccines for developing countries.
It comes amid hopes that U.S. job figures show a comeback in hiring for May, demonstrating continued global recovery. The dollar is holding onto a two-month high and the price of gold held above a key level of $1,900 as investors flock to the currency as an inflation hedge. U.S. core inflation rose above the Federal Reserve’s target on Friday.
In other news, OECD Secretary-General Angel Gurria’s term of office ends Monday and NATO chief Jens Stoltenberg is scheduled to brief press ahead of a Foreign and Defense Ministers meeting.
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