The control room of Euronext, the company that manages the Paris Stock Exchange (AFP / Eric PIERMONT)
The Paris Stock Exchange closed down 1.40% on Thursday, worried about the economic forecasts of the European Central Bank (ECB) and the rise in July of its key rates, which should continue in the fall.
The star CAC 40 index dropped 90.17 points to 6,358.46 points. The day before, the Parisian rating had already lost 0.80%, ahead of the ECB meeting.
Between the war in Ukraine, supply difficulties and inflation, “none of the major problems of the euro zone has been resolved: they are gaining in intensity”, estimates with AFP Patrice Gautry, chief economist at the Private Banking Union (UBP). “Now add to that the rise in rates. This is not a good cocktail for the confidence” of investors, he adds.
The ECB has in fact announced a 25 basis point increase in its key rates in July, a first in more than ten years, and it has promised further increases from September.
It thus intends, like the American and British central banks before it, to bring inflation under control by compressing demand, which is not to the taste of investors.
But the effect of its change of direction will not be immediate and will only be seen “in the long term”, has already warned Ms. Lagarde, while the institution is accused of having fallen behind in the face of galloping prices.
Inflation is therefore likely to be “sustainable”, warns Mr. Gautry, who also fears “risks of recession in the euro zone in the short term”.
On Friday, investors should have their eyes on the US inflation figure for May, which is expected to accelerate from the previous month.
Another point of concern: the European Central Bank has revised its growth forecast to 2.8% in 2022, instead of 3.7%. The IMF also announced during the day that it would revise its forecast for global growth.
Consumption concerns
The ECB’s upgraded inflation forecast also had an impact on distribution values.
Casino supermarkets fell 4.19% to 16.22 euros while its competitor Carrefour lost 1.35% to 18.65 euros.
The owners of shopping centers Klépierre (-4.02% to 20.78 euros) and Unibail-Rodamco-Westfield (-3.49% to 61.58 euros) were also struggling.
© 2022 AFP
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