Piazza Affari closes the session with a thud. The Ftse Mib index leaves 5.17% on the ground at 22,547 points and thus burns almost 39 billion euros of capitalization in a single day. Black Friday for the stock exchanges of the Old Continent as on Wall Street. The pan-European Stoxx 600 index lost 2.7%, sending in smoke more than 265 billion euros of capitalization in one session. Frankfurt lost 3.13% and Paris 2.83%.
In the United States i consumer prices in May rose by 8.6%, above the 8.3% expected by analysts. On a monthly basis, the increase was 1%, more than the expected 0.7%. The confidence of American consumers collapses to an all-time low. The Michigan index, which, when measured, fell in June to 50.2 from 58.4 in May. The figure is lower than the expectations of analysts who bet on 58.1.
It still rises spread between BTP and Bund which reaches 225 points on the Bloomberg platform. The Italian 10-year yield is 3.713%, a level it had not seen since February 2014 and higher than the surge seen in 2018, the year in which the differential suffered the effects of the political uncertainty of our country.
“I understand the interventions of the ECB to curb inflation, but the monetary route is not the solution to the problem”. This was stated by the president of Confindustria, Carlo Bonomi, on the sidelines of the regional assembly of industrialists today in Cagliari, responding to the question of reporters on the decision of the ECB to raise rates from July.
THE CLAW OF THE ECB – Goodbye, after seven years, to the purchases of public debt by the ECB. And goodbye also to the era of negative interest rates, with a first hike in July from a quarter of a point, followed by another one in September probably from half a point. As for the ‘anti-spread shield’, Frankfurt is committed, for the moment, only verbally and without giving itself a threshold beyond which to intervene. The June meeting of the ECB, this time away to Amsterdam, could not have had a more appropriate venue than the one offered by the Dutch central bank where the ‘hawk’ Klaas Knot sits. Because between the risks of out-of-control inflation due to war and energy prices, and the risks of recession caused by skyrocketing prices, the ECB has decided to focus on the former, following in the footsteps already traced by the Fed.
The Minister of Economy, Daniele Franco, during the OECD press conference in Paris, he said that the rate hike must take place “without tensions and shocks”. Franco recalled that to date we have “had a period of extremely low interest rates”, if not “downright negative”. “What we must avoid – he continued – is to introduce unnecessary tensions in this context. In the final press conference of the OECD ministerial council, chaired this year by Italy, Franco also said that” today it is a matter of selecting the trajectories of rate increases by central banks considering the factors underlying the rise in inflation. “The minister responded to a question about the turmoil in the markets following the decision of the European Central Bank (ECB) to raise interest rates since July. A decision that today had an impact on the spread of Italian bonds.
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