Archive

June 04, 2025
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US vs EU: Mutually Assured Destruction?

  • The consensus over Section 899 is that it is about leverage and deterrence, and that it is unlikely ever to be fully deployed, given the damage it would do to the US itself. However, what if the EU, in particular, calls Mr Trump’s bluff and/or it is intended even in part as a revenue-raising measure?

By Alastair Newton

June 03, 2025
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EA: May Be Disinflation’s Return

  • Negative payback in services inflation dragged the headline EA rate down to 1.92% in the May flash. Although only 7bps low on the day, releases last week had cut 0.1pp.
  • Inflation now looks set to spend a few months below the target rather than at or even above it, as had seemed likely until recently. This is not because of re-rooted imports.
  • Euro appreciation and low energy prices have expanded the ECB’s room to cut rates, but we still see June as the final one amid tight labour markets and peers backing away.

By Philip Rush

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