This week’s agenda at a glance

The European Central Bank is expected to raise key interest rates
The Eurogroup and EU financial ministers meet in Luxembourg
EU commission to present 2027 EU budget
UN Bonn Climate Change Conference
EU transport and telecommunication ministers meet in Luxembourg
Informal EU defence ministerial meeting
EU-South Korea summit

In light of recent inflation increases, the European Central Bank is expected to lift key interest rates for the first time this year on Thursday (11 June) during the governing council session in Frankfurt.

Following a decision to hold rates steady at two percent in April, financial analysts anticipate three separate increases of 0.25 percentage points each before year-end.

“The longer the [Iran] war continues and the longer energy prices remain high, the stronger is the likely impact on broader inflation and the economy,” ECB chief Christine Lagarde recently noted, conceding “we are certainly moving away from the baseline”.

In Luxembourg, the Eurogroup convenes on Thursday (11 June), with EU economy and financial services ministers gathering the next day on Friday (12 June).

Ministers aim to move forward on the Capital Markets Union, the EU initiative to link all 27 national financial markets into a single large framework. Advancement on the CMU has stalled for years amid ongoing disagreements over control and oversight.

Yet the EU’s six largest economies (Germany, France, Italy, Poland, Spain, and the Netherlands - representing about 70 percent of the EU’s population) have agreed to push strongly for centralized supervision of the bloc’s capital markets.

At an informal European Council meeting in February, EU Commission president Ursula von der Leyen cautioned that if member states fail to advance the long-awaited CMU this year, she will proceed with a smaller group of countries.

“Get me right. I prefer doing this by 27,” she stated then, noting the option for “at least nine member states, if they want to move forward faster.