Statistics after statistics, the scenario of high and lasting inflation is materializing. In Germany, the largest economy in the euro zone, consumer prices jumped 7.6% year on year in March, reaching a level not seen since the country’s reunification. In Spain, inflation reached 9.8% during the same period, the highest for 37 years, while it settled at 8.3% in Belgium, a peak since 1983. This outbreak generalized prices, essentially linked to the surge in oil and gas prices against the backdrop of the conflict in Ukraine, raises fears of a slowdown in the European economy, if not a tipping point into recession. ” The longer the war lasts, the higher the economic costs will be and the greater the likelihood that we will face more adverse scenarios. summed up the President of the European Central Bank, Christine Lagarde, during a conference organized by the Central Bank of Cyprus. “Households, more pessimistic, could reduce their spending and business investment is also likely to suffer “, she added.
Skeptical observers in Ukraine
All this is not to the liking of investors who, after being enthusiastic yesterday at the idea of a diplomatic solution to the Russian-Ukrainian conflict, are now coming to a little more reason. In Paris, the Bedroom 40 drops 0.74% to 6,741.59 points, after finishing Tuesday nearly 12 points above its closing level on February 23, the day before the start of the Russian offensive. Russia’s commitment to reduce radically His military operations around kyiv and Cherniguiv have observers skeptical, with several Ukrainian officials reporting bombings near those two cities on Wednesday as the siege of Mariupol continues.
In the United States, the specter of recession is also haunting investors. The ten-year and two-year yield curve inverted briefly on Tuesday. This signal, seen as a warning, is questioned by observers as major central banks have flooded the markets with liquidity through ultra-accommodative policies. Still, the market is showing nervousness after the US Federal Reserve (Fed) decision to accelerate the rate of rise in Fed-funds at a time when global growth is showing signs of slowing.
Banks and the automobile again in the red
In the spotlight on Tuesday, banks and car stocks suffered releases, like Societe Generale (-2.48%) or Renault (-3.85%). The diamond brand plans to transfer ownership of its majority stake in AvtoVaz to a Russian investor in order to leave the country, Bloomberg reports, citing a source familiar with the matter.
Conversely, crossroads gained 1.45%. The retailer has announced its intention to install more than 700 charging stations for electric vehicles and 5,000 charging points in its Carrefour Market hypermarkets and supermarkets in France by 2025.
TotalEnergies picked up 2.52% in the wake of the barrel of Brent, which rose 3% to 113.7 dollars. Added to questions about the likelihood of an easing of the conflict in Ukraine is the fact that weekly oil inventories have fallen more than expected in the United States, according to data from the American Petroleum Institute (API) and the United States Department of Energy (EIA). OPEC + must decide tomorrow on the evolution of its production for the month of May, but some producing countries have already indicated that it would be difficult to remedy the shortfall in Russia.
PC