Get all your news in one place.
100’s of premium titles.
One app.
Start reading
The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

FTSE 100 posts biggest jump since March as US economy adds 339,000 new jobs – as it happened

ING France Emmanuel Macron United States SP Bruno Le Maire Elisabeth Borne eurozone (Organization) Le Maire GDP
A share dealing day in the City Of London.
A share dealing day in the City Of London. Photograph: Paul Painter/Alamy

A very late PS: France avoided being downgraded by Standard & Poor’s.

The rating agency left the French credit rating unchanged at AA, with a negatve outlook due to “downside risks to our forecast for France’s public finances amid its already elevated general government debt”.

That should please Paris, given the efforts by ministers to persuade S&P not to lower its credit rating.

Reuters has more details:

S&P said that it now expects a slightly smaller public sector budget deficit following a recent update of the government’s long-term financial plans that aim to cut the deficit to 2.7% of economic output in 2027 from 4.9% this year.

The ratings agency also said that it looked positively on a reform of unemployment benefits last year and a law passed this year to raise the retirement age two years to 64, which sparked weeks of protests and strikes.

FTSE 100 gains 1.5%

And finally, the London stock market has racked up its best day since late March.

The blue-chip FTS 100 index has closed 117 points higher at 7607 points, up over 1.5% today.

That recovers its losses earlier this week, when recession worries were weighing on the markets.

Insurance group Prudential (+5.6%) was the top riser, followed by copper miner Antofagasta (+5.5%) and commodity giant Anglo American (+5.15%).

Analysts at ABN Amro sum up today’s jobs report:

The takeaway is that the labour market remains both exceptionally strong on the demand side, as signalled by the jobs numbers, but we also see that layoffs are increasing, leading to a rise in unemployment.

This is corroborated by the Challenger job cuts report for May, which shows layoffs somewhat on the high side, though by no means consistent with recession yet. Meanwhile, the JOLTS job vacancy report for April – also released this week – showed a rise in vacancies and an upward revision to previous months, suggesting a lower likelihood that excess demand for labour can be eliminated without a meaningful rise in the unemployment rate.

And that’s all for this week. Have a lovely weekend. GW

The White House has hailed today’s jobs report, pointing out that it extends the jobs gains under the current administration:

Employment has risen pretty steadily since the restrictions imposed to fight the Covid-19 pandemic were eased.

The bipartisan bill to solve the US debt ceiling crisis just days before a catastrophic and unprecedented default is on its way to Joe Biden’s desk, as the US president prepared to address the nation and hailed “a big win for our economy and the American people”.

The compromise package negotiated between Biden and House Speaker Kevin McCarthy passed the US Senate late on Thursday.

Biden acknowledged that it leaves neither Republicans nor Democrats fully pleased with the outcome. But the result, after weeks of torturous negotiations, shelves the volatile debt ceiling issue until 2025, after the next presidential election.

“No one gets everything they want in a negotiation, but make no mistake: this bipartisan agreement is a big win for our economy and the American people,” Biden tweeted after the Senate voted 63 to 36 to pass the deal agreed between Biden and McCarthy last weekend, which passed the House on Wednesday.

Encouraging:

Afternoon summary

A quick recap:

High interest rates, a recent banking crisis and Washington’s fight over the debt ceiling may have shaken the US economy recently, but the US jobs market continues to show signs of strength.

The US Bureau of Labor Statistics (BLS) reported 339,000 jobs were added in May, surpassing forecasts that predicted the increase would be approximately 190,000 jobs and a sign of continued growth from the jobs market despite the Federal Reserve’s continuing efforts to cool the economy.

But, the US unemployment rate has risen to 3.7%, and wage growth cooled last month.

The latest jobs report has pushed up shares on both sides of the Atlantic, with investors also relieved that the Senate narrowly passed a bill to suspend the debt ceiling on Thursday night.

The pound is track for its best week against the US dollar this year, with the Bank of England expected to keep raising interest rates this year to fight inflation.

World food prices have dipped to their lowest level in two years, as the shock caused by Russia’s invasion driving up commodity prices fades.

Ireland’s domestic economy has escapted a shallow recession, by returning to growth in the first three months of the year.

France is bracing for a possible credit rating downgrade from Standard & Poor’s tonight, when the agency updates its assessment.

A network of underground geothermal plants is being touted as a way to help level up the UK after a report discovered many areas with the greatest geothermal potential lie beneath the towns and cities most in need of investment.

Britain’s electricity system operator is to tell energy developers to get on with their projects or get out of the queue for a grid connection as it struggles to manage the growing backlog of delayed green energy projects.

More than 20,000 rail workers in England have begun a 24-hour strike that will cancel half of the services on affected lines as part of a long-running dispute with train operators over jobs, pay and conditions.

Fiat has called on the government to boost incentives for British motorists to buy electric vehicles, after warning that growth in UK sales of the vehicles has tailed off after a key subsidy was scrapped last year.

Shareholders in Purplebricks have voted overwhelmingly to sell the online estate agent for only £1 to Strike, a competitor backed by the telecoms tycoon Sir Charles Dunstone.

Updated

Ireland aren’t having the best day at Lords (where England are rollicking along at 465 for 2), and the economic picture in the Republic is a little mixed too.

On the upside, Ireland’s domestic economy has returned to growth in the first three months of the year after a shallow recession, data showed on Friday.

Ireland’s finance minister, Michael McGrath, said momentum was set to continue as the country hits full employment:

“Incoming data suggest that momentum has continued into the second quarter, bolstered by a record low unemployment rate of 3.8% registered in May.”

However, Ireland’s GDP fell 4.6% in the first quarter, a sharp fall. But, GDP is a volatile measure of Ireland’s economic performance, as it can be disruped by multinational companies.

FTSE 100 on track for best day since March

Stocks are pushing higher in London, too.

The blue-chip FTSE 100 index is now up 97 points, or 1.3%, at 7587 points, on track for the biggest one-day jump since 21 March.

Paul Ashworth, Chief North America Economist at Capital Economics, points out that there are sighs of weakness in the US jobs report.

Ashworth says:

The bigger-than-expected 339,000 increase in non-farm payroll employment in May will dominate the headlines, but the employment report was not all positive – with a big drop in the household survey measure of employment driving the unemployment rate up to a seven-month high of 3.7% and average weekly hours worked edging down to a three-year low.

[such weakness could encourage the Fed to resist further rate hikes].

May brought the largest increase in US jobs since January, points out Josie Anderson, managing economist at Centre for Economics and Business Research.

Anderson explains:

“The number of US non-farm payrolls increased by 339,000 in May, roughly in line with the average job additions recorded in the 12-month period to April 2023, of 341,000. It is the first time since January that the increase in payrolls has stood above 300,000, bucking the broadly downwards trend in additions.

After last week’s acceleration in PCE inflation, today’s data on net payroll additions add to the likelihood of another Fed rate rise later this month.”

A chart of US payrolls

Wall Street rallies after jobs report

Shares are rallying in New York in early trading.

The Dow Jones industrial average, of 30 large US companies, has jumped by 351 points or 1.1% at 33,413.

The broader S&P 500 is also 1% higher, while the tech-focused Nasdaq Composite has jumped by 1.1% to its highest level since April 2022.

Simon Harvey, Head of FX Analysis at Monex Europe, says:

A monstrous 339k jobs were added in May, up from an upwardly revised 294k in April. This net employment increase is the largest since January’s whopping 472k figure, which sparked markets to price in a higher terminal rate for the Fed – a contributing to the start of the regional banking crisis just a month later.

Although, despite the recent uptick in the pace of employment, it is worth noting May’s gains are in line with the series +341k twelve-month average. While the net employment figure suggests that labour demand is yet to come off the boil, the rest of May’s jobs report was on the soft side, leaving the market-implied odds of a rate hike from the Fed in June relatively low.

Updated

Bad news for US borrowers: Another interest rate hike is in the bag, after today’s jobs report.

That’s the verdict of Seema Shah, chief global strategist at Principal Asset Management, who also argues tha hopes of rate cuts this year are misplaced.

Shah says:

May’s blow out jobs report, combined with an upward revision to April, means that the Fed’s job is not yet done. The key question now is: can they wait until July or does this monster payrolls number trigger another burst of urgency in the FOMC? Perhaps the report details, with the unemployment rate rising and average hourly earnings growth slowing, tilts the decision to July.

But overall, this is not a labour market that is slowing – and if it’s not slowing, then inflation isn’t coming down to 2%.

In the past month, incoming economic data has emphasised the continued stickiness of inflation and resilience of the labour market. Markets have repriced their rate outlook significantly but are still over-optimistic about the prospects of rate cuts this year. With May payrolls almost double the average monthly gain in the 10 years pre-pandemic, what reason would the Fed have to cut rates?”

Updated

Today’s US jobs report could spur some Federal Reserve policymakers to push for another increase in interest rates this month.

So says Neil Birrell, chief investment officer at Premier Miton Investors, who explains:

“Expectations of a rate rise have been flip-flopping this month, and the employment data has now shown a surprisingly large increase in payrolls.

This may well flip markets back to pencilling in a hike.

The Fed has said it is data dependent and what it reads into this is therefore crucial. This will undoubtedly give plenty of support to the more hawkish members of the Fed.”

Updated

US labor market 'is still very tight'

Richard Flynn, managing director at Charles Schwab UK, says:

“Investors will interpret today’s strong jobs report as a sign that the US labour market is still very tight. The figures underscore the success of the US economy in getting workers back into the workforce.

Amid myriad concerns for investors this year, the labour market remains in focus given its strength as it continues to outpace economists’ estimates

Updated

Some snap reaction to the US jobs report:

US short-term government debt has weakened, following the stronger-than-expected jobs growth last month.

This has driven up the yield, or interest rate, on two-year Treasury bills:

Wage growth slows to 4.3%

Although US job creation accelerated last month, wage growth cooled in May.

Over the past 12 months, average hourly earnings have increased by 4.3%, today’s non-farm payroll shows. That’s down from 4.4% in the year to April.

It’s also below the US CPI inflation rate, which rose by 4.9% in the year to April.

In May along, average hourly earnings rose by 11 cents, or 0.3%, to $33.44.

US added 339,000 jobs in May, higher than expected

Newsflash: the US economy added 339,000 jobs last month, a stronger increase than expected, despite the impact of higher interest rates.

Economists had expected around 190,000 new jobs, but instead hiring has accelerated – in a potential boost to president Joe Biden, but a new headache for US Federal Reserve chief Jerome Powell as he tries to cool inflation.

Job gains occurred in professional and business services, government, health care, construction, transportation and warehousing, and social assistance, according to the latest report from the U.S. Bureau of Labor Statistics.

March’s Non-Farm Payroll has been revised higher too, by 52,000, from +165,000 to +217,000. April’s data has been revised up by 41,000, from +253,000 to +294,000.

However, the US unemployment rate has risen by 0.3% to 3.7%. The number of unemployed people rose by 440,000 to 6.1 million – with more people out of work and looking for a job.

Updated

Global stock markets are rallying today, as are commodity prices, as investors express relief that the US debt ceiling crisis has been resolved.

Optimism that the US Federal Reserve could leave interest rates on hold next month are also supporting asset prices.

In London, the FTSE 100 share index has jumped by 0.9% or 68 points to 7558, the highest since Tuesday, lead by mining stocks.

Earlier today, Japan’s benchmark Nikkei index closed at a three-decade high, after U.S. lawmakers voted to raise the debt limit.

There are also likely to be painful job cuts at Swiss bank Credit Suisse, following its takeover by UBS.

UBS chief executive Sergio Ermotti told a financial conference in Bern today:

“We won’t be able to create, short term, job opportunities for everybody. Synergies is part of the story.

“We need to take a serious look at the cost base of the standalone and combined organisations and create a sustainable outcome.

It will be painful.”

Full story: Fiat seeks incentives from UK for motorists to buy electric vehicles

Fiat has called on the government to boost incentives for British motorists to buy electric vehicles, after warning that growth in UK sales of the vehicles has tailed off after a key subsidy was scrapped last year.

Writing in an open letter to the government, the car manufacturer said other countries around the world were providing more support for the transition to electric vehicles and argued more action was required in Britain.

It comes a year after ministers scrapped the last remaining subsidies for electric cars, saying it would free up funds to expand the charging network and support other battery-powered vehicles.

However, car manufacturers warned this week of a gulf between the number of electric vehicles on the road and public charging points, with the shortfall more than doubling in some parts of the country in the past year….

More here:

Mike Ashley's Frasers to lay off up to 200 workers - Reuters

Mike Ashley’s Frasers Group is set to lay off up to 200 employees, as the British retailer looks to streamline its business after making a string of acquisitions in recent years, Reuters reports.

A spokesperson for the company, which was previously called Sports Direct, said in an e-mail.

“We are reviewing our team structures to identify efficiencies and streamline processes, and we have entered a consultation period with colleagues affected by these changes,”

The job cuts were first reported by the Sun last week.

Ashley - who once owned the Newcastle United football club - no longer heads Frasers but holds a roughly 70% stake in the company, which owns brands including House of Fraser, Flannels, USC and Jack Wills.

Earlier this week Frasers narrowly avoided falling out of the blue-chip FTSE 100 index in the latest reshuffle.

The Department for Transport have responded to Fiat’s call for more support to incentivise drivers to buy electric cars.

A DfT spokesperson said:

“We’ve invested more than £2bn into accelerating the transition to electric vehicles, and grants have been in place for over a decade to support the transition to zero emission vehicles – supporting more than 340,000 so far.

“To ensure value for the taxpayer, our support is now targeted where it will make most impact, including grants for vans and taxis, and support for the roll-out of rapid chargers.”

Pound heads for strongest rally against dollar in six months

The pound is on track for its best week so far this year.

So far this week, sterling has gained 1.5% against the US dollar, or almost two cents, to $1.253 this morning.

The rally comes as investors conclude that interest rates are likely to level off sooner in the US than in the UK, given Britain’s persistent inflation problem.

In the UK, annual inflation was 8.7% in April, compared with 4.9% in the US.

The latest US jobs report, at 1.30pm, will help the US Federal Reserve judge if jobs creation, and wage growth, is slowing due to higher borrowing costs.

Relief that the US should lift the debt ceiling, to avoid a default, are also providing some support.

Fawad Razaqzada, market analyst at City Index and FOREX.com, explains:

Risk sentiment has improved markedly with the passage of the US debt ceiling deal through Congress. This kept European currencies supported on Friday morning.

Updated

World food prices fall to two-year low in May

Global food commodity prices have hit their lowest level in over two years, according to fresh data from the United Nations food agency.

The Food and Agriculture Organization’s (FAO) price index, which tracks the most globally-traded food commodities, has hit its lowest level since March 2021.

There were “significant drops” in the price indices for vegetable oils, cereals and dairy, which were partly counterbalanced by increases in the sugar and meat indices, the FAO reports.

The price index fell to 124.3 points in May, down from 127.7 in April. It is now 22% lower than the all-time high of March 2022, after the invasion of Ukraine sparked a surge in food costs.

A chart of the UN FAO's world price index for food
A chart of the UN FAO's world price index for food Photograph: UN Food and Agriculture Organization

The report shows that:

  • International wheat prices declined by 3.5 percent month-on-month, reflecting prospects for ample global supplies in the upcoming 2023/24 season and the extension of the Black Sea Grain Initiative.

  • The Vegetable Oil Price Index fell 8.7% in May, and was 48.2% below its year-earlier level. The continued decline in the index reflected lower world prices across palm, soy, rapeseed and sunflower oils.

  • The Dairy Price Index fell 3.9%, led by a steep drop in international cheese prices, principally due to ample export availabilities, including from inventories, amid seasonally high milk production in the northern hemisphere

Secretary-General of the National Union of Rail, Maritime and Transport Workers (RMT) Mick Lynch with union members at a picket line outside Euston Station today
Secretary-General of the National Union of Rail, Maritime and Transport Workers (RMT) Mick Lynch with union members at a picket line outside Euston Station today Photograph: Leon Neal/Getty Images

Strike action over the last year has been a success despite the lack of a pay deal, RMT general secretary Mick Lynch has said.

Speaking from the picket line at Euston station, as today’s strike action got underway, the union leader said that the action had pushed back plans that would have negatively impacted RMT members.

Lynch said:

“We’ve pushed them back on all the stuff they wanted to do, they wanted to make thousands of our people redundant, they wanted to shut every booking office in Britain, restructure our engineering workers, cut the catering service.

“So we’ve pushed them back on that, they haven’t been able to implement any of their plans.

People on the concourse at Waterloo train station in London during today’s strike the RMT
People on the concourse at Waterloo train station in London during today’s strike the RMT Photograph: James Manning/PA

Lynch added:

“What we haven’t got is a pay deal, we haven’t got any guarantees on our members’ futures but we have stopped them doing the worst aspects of their proposals and their ideas.

“It has been a success, our members are still with us, they’ve had three ballots to continue with the strike action under the law. Other people seem to have been inspired to fight back and take action in their own industries, so it has been a success and it’s put trade unions back on the map in Britain.”

Lynch also accused the government of “subsidising” disruption on the railways, telling Radio 4’s Today programme:

“They are subsidising this disruption: £900 million has been delivered to the train operating companies to deliver this dispute. They are enforcing the disruption.

“All we want is a pay rise and the protection of our terms and conditions.”

RMT strike in England begins two days of rail disruption

More than 20,000 rail workers in England have begun a 24-hour strike that will cancel half of the services on affected lines as part of a long-running dispute with train operators over jobs, pay and conditions.

The stoppage by the National Union of Rail, Maritime and Transport Workers (RMT) – the second of three by rail unions to hit the network this week – will affect most operators in England and some cross-border services into Scotland and Wales.

Then on Saturday more than 12,000 members of Aslef, the train drivers’ union, who went on strike on Wednesday, will carry out another day of industrial action that will leave only 40% of services running.

The wave of rail disruption coincides with half-term holidays for most schools in England and Wales, and will cause difficulties for people travelling to events in London this weekend. Those affected include supporters travelling to see the FA Cup final at Wembley on Saturday between Manchester City and Manchester United, racegoers hoping to attend the Epsom Derby and tens of thousands of Beyoncé fans hoping to catch the pop star’s Renaissance tour shows in the capital.

Rail operators have said services on Friday and Saturday will be severely reduced and have urged passengers to plan their journey before travelling.

More here, by my colleague Casper Hughes:

Fiat calls for more incentives to kick-start UK electric car demand

Car manufacturer Fiat has warned that growth in electric car sales in the UK is tailing off, and called for more government help to get people to switch from fossil fuel vehicles.

Fiat is concerned that EV sales are not accelerating as quickly as it or other manufacturers expected.

In a letter to the government, it warns that the market share of EV’s in the UK has plateaued in the year since the Plug-in Car Grant (PiCG), which subsidied the cost, was abolished.

Fiat is now asking ministers to boost incentives for British motorists to make the switch to electric vehicles (EVs).

Fiat are also offering a £3,000 discount to its electric cars, dubbed the Fiat ‘E-Grant’, which is larger than the phased-out government subsidy.

Damien Dally, Fiat UK’s managing director, told Radio 4’s Today Programme that the EV market has grown from less than 1% in 2019 to 15% today.

Dally says:

That means 85% of people are not buying electric vehicles today. And it’s really halted since the removal of the grant.

Fiat believes that demand for EV cars will start to tail off in six month’s time, Dally says.

He agrees that a better charging infrastructure would help the EV industry, but insists charging is becoming easier.

A new report from Resolution Foundation this week shows that the move away from petrol and diesel cars will create a £10bn shortfall in tax revenues – arguing for a new “package of measures that ensure EV drivers start to pay their way”.

Fiat’s Dally, though, argues that the government needs to do more to incentivise the shift to EV, saying:

I think the government is already talking about looking at other ways of taxing in terms of road tax, etc. I think that’s been discussed for 2025.

But ultimately, at the moment…we need to give people equally a reason to make that switch.

Dally argues that could be tax breaks, either subsidies or similar incentives, to encourage motorists to shift, warning that demand is “really, really dropping off significantly”.

It’s understandable, because of the cost of living crisis etc. People need a reason to buy. Otherwise, I think they will just walk into another petrol or diesel car.

Fiat’s calls follow similar pressure on the government from elsewhere in the automobile industry.

Its parent company Stellantis, which also owns the Peugeot, Chrysler and Citroën brands, warned last month that post-Brexit trading arrangements are a risk to its operations in the country.

Senior officials in Brussels are now urging the UK to join a pan-European agreement on goods trade to limit the damage to its car industry from looming post-Brexit tariffs, the Financial Times reports today.

The FT says:

From next January, electric vehicles shipped between the UK and the EU will need to have at least 45 per cent of their parts sourced from within the two regions or face 10 per cent tariffs, under “rules of origin” terms set out in their post-Brexit trading agreement.

The limit rises to 60 per cent for batteries, which make up a significant part of the value of an EV, and is particularly problematic as the UK and EU still import many from China, South Korea or Japan. London wants the EU to delay the introduction of the levy until 2027.

The move is backed by carmakers in the UK and EU, which have warned they will not be able to comply with “rules of origin” from next January due to the lack of battery manufacturing capacity in Europe.

More here: Brussels urges UK to join trade pact to ease risk of post-Brexit car tariffs

Updated

In a boost for France, industrial production across the country has picked up – helped by a drop in strike action.

Manufacturing output rose by 0.7% in April, new data from statistics body INSEE shows, while wider industrial output gained 0.8%.

Output “bounced back substantially in the manufacture of coke and refined petroleum” – rising by +23.6% in April after a 45.2% plunge the previous month.

That, INSEE said, is because the strikes in refineries were less significant than in March, when protests against president Macron’s pension reforms blocked several French refineries from delivering products.

The health of the US jobs market will also be in the spotlight today, when the latest non-farm payroll is published.

Economists expect a slowdown in hiring last month, with around 193,000 new jobs created, down from 253,000 in April.

A sharp slowdown could deter the US Federal Reserve from raising interest rates again, while a strong NFP could spur them on.

The question of the sustainability of France’s public debt has moved back into the spotlight, analysts at ING warn.

In a report published yesterday, ING warn it has become “an important issue for the government, the general public and the rating agencies alike in a context of economic slowdown, rising interest rates and a minority government in parliament”.

As they point out, France’s national debt has risen due to recent economic shocks:

Already well above the eurozone average, the ‘whatever it costs’ approach of the government has led to a significant increase in French public debt since the pandemic, rising from 97.4% of GDP in 2019 to 111.6% of GDP in 2022.

Over the period, this represents an increase of 14.2 percentage points, the highest among eurozone countries after Spain. By the end of 2022, France was the fifth country with the highest debt-to-GDP ratio in the eurozone, well above the European target of 60%.

If policy remains unchanged, the government estimates that public debt could continue to rise over the next few years, reaching 114.6% of GDP in 2027.

French president Emmanuel Macron has also been warned that the country can’t afford tax cuts without also trimming spending.

Yesterday, Bank of France Governor Francois Villeroy de Galhau told a conference:

“We need to make a bigger effort on the public finances, we need to be careful about unfunded tax cuts and letting spending grow too quickly,”

Last month, Macron revealed he had asked his government to draw up €2bn worth of tax cuts that would benefit the middle class.

Updated

Introduction: Standard & Poors expected to rule on France's credit rating

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

France is bracing for a possible credit rating downgrade today, despite some strenuous efforts by Paris to fend the risk off.

Standard and Poor’s, one of the Big Three rating agencies, is expected to update its assessment of France’s credit-worthiness later today.

Back in December S&P cut France’s outlook to “negative” from “stable”, due to rising risks to the country’s public finances, so it could now cut France’s AA rating – the third-highest notch.

Since December, France’s economy has grown by 0.2% in the January-March quarter, and president Emmanuel Macron has signed a controversial pension reform into law, after wide protests and much bashing of pots and pans on the streets by furious members of the public.

In April, Fitch downgraded France’s sovereign credit rating and warned that Macron’s reform agenda could stall following the battle to increase the country’s retirement age.

And last week another rating agency, Scope, lowered its outlook on France’s credit rating, blaming weakening public finances and risks to Macron’s economic reform agenda.

A downgrade could be embarrassing for Paris, and raise questions about Macron’s efforts to spur growth and reduce a debt burden that has been pushed higher by spending on the pandemic and then subsidising energy costs since the Ukraine war.

The risk of a downgrade on Friday “could be a wakeup call for the markets,” Adam Kurpiel, rates strategist at Société Générale, told Bloomberg, adding:

“We and the rating agencies have been highlighting the weakness in France’s public finances for some time.”

France’s finance minister, Bruno Le Maire, pledged in April to “accelerate France’s debt reduction”. He is aiming to lower the national debt from 111.6% of GDP to 108.3%, by 2027.

By then, Paris hopes to have brought the budget deficit down to 2.9% of GDP, back below the 3% limit set under the European Union’s Growth and Stability Pact.

Earlier this week, La Maire launched an effort to deter S&P from cutting France’s credit rating.

He told public broadcaster France Inter that he made a compelling case to S&P when he met its representatives earlier this week, pledging to be “uncompromising” with the debt reduction plan.

Le Maire pledged:

“We have good arguments to put forth.

Prime minister Elisabeth Borne said on Sunday that Le Maire is in “very close discussions” with S&P.

Borne told Radio J.

“I think there were detailed explanations from Bruno Le Maire to Standard and Poor’s on everything we’re doing to control our public finances and I think that we act in this direction.”

The US, though, can breathe easier about its credit rating today. Last night, the US Senate narrowly passed a bill to suspend the debt ceiling, which should avert the risk of a default that could have wreaked havoc on the US economy and global markets.

The agenda

  • 7.45am BST: French industrial production data for April

  • 9.30am BST: The latest realtime UK economic activity data

  • 1.30pm BST: US non-farm payroll jobs report for May

Updated

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
FDA restricts psychoactive mushroom used in some edibles
The regulator warned food manufacturers that Amanita muscaria –  more commonly known as the fly agaric – and the compounds it contains are not authorized to use
The Independent UK
The Independent UK
“I go to church every Sunday when I’m home. Especially now I’ve replaced the booze with glue”: From GN’R and Pantera to Ozzy Osbourne and God, Zakk Wylde is the most connected man in rock
It’s Zakk Wylde’s world - we just live in it
Metal Hammer
Metal Hammer
My husband and I tried the Scandi Sleep Method and love it — 3 reasons you will too
We avoided a sleep divorce thanks to the Scandinavian Sleep Method, but will it work for you too? Three telltale signs that it will...
Tom’s Guide
Tom’s Guide
45 Years Ago, A Disney Misstep Was A Secret Sci-Fi Masterpiece
The haters were wrong. On its 45th birthday, 'The Black Hole' is just as wonderfully manic as ever. Here's why this flop is actually worth your time.
Inverse
Inverse
Black long COVID patients ignored
New research found that those living with long COVID in the U.S. had significantly more anxiety and depression
Salon
Salon
Jared Leto’s latest ‘iconic’ role leaves fans divided
‘Skeletor was going to make or break this movie,’ said one fan
The Independent UK
The Independent UK
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.
Download on the AppStore Get it on Google Play