REVIEW in the South / Economy, Central Banks, Politics | News

Highlights and reports on the economy, central banks and politics from the Dow Jones Newswires program

S&P Global: German service providers lose momentum in June

German service providers clearly lost momentum in June. The S&P Global purchasing managers index for the sector weakened to 52.4 from 55.0, according to final data for the month. This is the lowest value in five months. Economists forecast a reading of 52.4. A provisional value of 52.4 was also set for June.

S&P Global: weakest growth in the Eurozone in 16 months

Economy Eurozone Continuing on its upward trajectory in June, growth has slowed to its lowest level since the start of the recovery in March 2021. The composite euro area private sector output index, which includes industry and services, fell to 52.0 from 54.8 in the previous month. as reported by S&P Global in the second publication.

Barclays: Price pressure in euro zone industry is falling

Barclays economist Mark Cus Babic sees the publication of the Purchasing Managers’ Index (PMI) as a confirmation of his assessment that the eurozone is heading towards recession. “Services are declining and production is showing signs of erosion in demand and easing inflationary pressures,” writes his article. Growth in the tourism sector has likely already peaked.

HDE: Retail sales will decline by 2 percent after adjusting for inflation in 2022.

The German Retail Trade Association (HDE) assumes that the retail sector as a whole will have a nominal sales increase of 3 percent compared to the previous year to 607.1 billion euros, after adjusting for inflation this is minus 2 percent. According to the forecast, sales in stationary trade will increase by a nominal 1.4%, while online trade will increase by 12.4%. “Rising inflation, rising energy costs and poor consumer sentiment are creating a difficult environment for retail,” explained the association.

Rabobank: The ECB goes hand in hand with the TLTRO

According to Rabobank analysts, the European Central Bank (ECB) cannot hold back windfall profits on TLTRO loans from euro area banks without jeopardizing the original long-term goals and targeted refinancing operations (TLTROs). As they write in the analysis, banks used TLTRO3 series loans primarily for the purposes intended by the ECB. Taking the profits from the banks of unexpectedly aggressive interest rates would put the entire package into question.

Muller: ECB should raise interest rates by 25 basis points in July – agency

According to a member of the ECB’s Governing Council, Madis Muller, the European Central Bank (ECB) should raise interest rates by just 25 basis points in June, in line with the recently announced plan. Given the inflation outlook, it is appropriate to raise interest rates by 0.25 percentage points, Muller said in an interview with Dubrovnik, according to a Bloomberg report.

Klingbeil: The Easter package will start in the last week of the session

SPD chairman Lars Klingbeil confirmed that the traffic light coalition had finally reached agreement on the Easter package to accelerate the energy transition and demanded even more far-reaching measures. “I am delighted that an agreement has been reached on the Easter Package,” Klingbeil said at a conference on the SPD economic forum. “The negotiations this weekend were very difficult and full of passion,” he stressed. “But in the last week of the session, we were able to launch the Easter package.”

BDEW advocates a pay-as-you-go system when gas prices are high

The Federal Association of the Energy and Water Industry (BDEW) campaigned for a pricing system to evenly spread the increased costs across the gas industry. Chief Executive Officer Kerstin Andreae told Deutschlandfunk that none of the imaginable systems was cool because someone would have to pay higher prices in the end. However, the tribute is the possibility of shifting the costs in a semi-solidarity form and spreading them over as many shoulders as possible.

Netzagentur: In 2021, gas supplies continued to be reliable

Over the past year, the security of supply has been reliable. According to the Federal Network Agency, the average end-user gas supply interruption in 2021 was 2.18 minutes (2020: 1.09 minutes). The value of around 2 minutes is slightly above the long-term average. “Even if the duration of the supply interruptions is extended in 2021, gas supplies in Germany are still very reliable,” said Klaus Mller, president of the Federal Network Agency. “The main reason for the increase in the average downtime was mainly external influences on gas lines during construction works.”

Renewable energy sources cover almost half of the electricity consumption in 1H

The share of renewable energy in electricity consumption in Germany increased significantly in the first half of the year. As shown by preliminary calculations by the Baden-Württemberg Solar and Hydrogen Research Center (ZSW) and the Federal Association for Energy and Water Management (BDEW), renewables covered about 49 percent of the country’s gross electricity consumption in the first six months. This is six percentage points more than in the first half of 2021.

The banking industry wants more freedom for innovation in payment transactions

Following the revision of the Second Payment Services Directive (PSD2) launched by the European Commission, the German banking sector has called for “customer orientation to be real and to provide institutions with more room for innovation”. The directive currently blocks this and creates false incentives in the market. PSD2, which entered into force in 2018, was intended to promote competition and share data from payment transactions. Among other things, customer interfaces from banks and savings banks were opened for the new service providers.

IMK: Labor costs will increase by 1.2 percent. in 2021 – no wage and price spiral

According to a study by the Institute of Macroeconomics and Business Cycle Research (IMK) of the Hans Beckler Foundation, there are currently no signs of a price-wage spiral in Germany. According to the IMK analysis, German labor costs increased by 1.2 percent. year on year in 2021, after an increase of 2.2% in 2020, this put German labor costs in seventh place in the European Union in the last year of labor costs and unit wage.

The European Parliament votes to tighten the regulation of internet giants

The European Parliament voted overwhelmingly in favor of stricter regulation of large internet companies such as Google and Amazon. Finally, in Straburg, MEPs approved the Market Control Act (DMA) and the Digital Services Act (DSA). Thanks to the act on digital markets, the EU wants to prevent anti-competitive behavior of large Internet companies in the European Union. The Act on digital services obliges online platforms, among others to step up action against hatred and false information.

NATO signs accession protocols for Finland and Sweden

In Brussels, the ambassadors of 30 NATO countries initiated the process of ratifying the accession of Finland and Sweden to NATO. “The signing of the accession protocols initiates the ratification process in each of the member states,” said NATO Secretary General Jens Stoltenberg in Brussels. After signing the accession protocols, 30 NATO countries still have to approve accession.

Biden is considering lifting trade tariffs against China, source

US President Joe Biden is considering part of his predecessor, according to informed sources Donald Trump the withdrawal of trade duties against China. Biden is expected to abolish some charges on Chinese imports soon, the Wall Street Journal reported, citing those familiar with government talks.

+++ economic data +++

France / Services Purchasing Managers’ Index June 53.9 (second update)

FR / PMI services in June FORECAST: 54.4

The PMI index for FR / Services in May was 58.3

Italy / PMI Services June 51.6

IT purchasing / service managers index JUNE FORECAST: 51.5

The IT / Service Purchasing Managers index is 53.7

UK / PMI Services June 54.3

UK / Services Purchasing Managers’ Index June PROG: 53.4

PMI for Great Britain / Services in May was 53.4

DJG / DJN / AFP / apo

(END) Dow Jones Newswires

July 5, 2022 07:30 ET (11:30 GMT)

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