Europe’s major indexes closed in the red on Monday, as investors digested inflation data from some of the region’s biggest economies on a quiet day due to holidays in the U.K. and U.S.
Germany’s DAX provisionally ended the day down 0.7%, retreating from an all-time high hit last week. France’s CAC was also around 0.7% lower at the end of the day. Spain’s IBEX fell around 0.9%.
Meanwhile, Italy’s FTSE MIB ended the day broadly flat. It is a bank holiday in the U.K. with the FTSE 100 closed. U.S. markets are also closed, this time for Memorial Day weekend.
The German index was weighed down by Deutsche Bank, whose share price fell as much as 2% after reports that the U.S. Federal Reserve said it was concerned about the German lender’s anti-money laundering practices. By the end of the day it had pared some losses to close around 1.3% lower.
It comes after inflation data was published for countries including Spain, which saw its highest inflation reading in four years. Consumer prices rose 2.4% in May year-on-year according to flash data from the country’s National Statistics Institute. In Germany, inflation rose 2.5% on the year in May, reinforcing that inflation has arrived on the continent.
Meanwhile, France on Monday begins Covid-19 vaccinations for everyone over the age of 18.
OECD ups forecasts
The OECD’s latest Economic Outlook, published Monday, brought some good news for the euro area. Its report, entitled “No Ordinary Recovery,” said the global economic outlook is brightening, but in a very uneven way. For the global outlook overall, the organization sees a 5.8% growth in gross domestic product (GDP) in 2021, compared to a 3.5% contraction in 2020. It forecasts a 6.3% growth for the G20 group of developed economies, and 4.3% for the Euro area.
It added, however, that despite encouraging signs in health and economic recovery, there remain some significant headwinds, namely not enough vaccines for developing countries.