European financial markets are set to react to two major events: the European Central Bank’s rate decision and the EU Parliamentary elections.
It will be a pivotal week for European markets as the ECB may cut interest rates for the first time in eight years. The EU elections on 6 June will also shape the regional political landscape. Additionally, the US will release its May employment data, a crucial indicator for the Federal Reserve’s upcoming rate decision.
Europe
The ECB is widely expected to initiate a quarter-percentage-point rate cut, bringing the main refinancing rate to 4.25% on Friday. Inflation in the euro area has followed a sustained disinflationary trend. May’s headline CPI is anticipated to reach 2.6%, marking the eighth consecutive month below 3%, albeit slightly higher than the estimated 2.5%. The central bank has signaled a readiness to ease monetary policy if inflation continues to…
