European equities edged lower Monday as investors braced for a pivotal week of central bank commentary and fresh U.S. inflation data. At 03:05 ET (07:05 GMT), Germany’s DAX fell 0.3%, France’s CAC 40 slipped 0.1%, and the U.K.’s FTSE 100 dipped 0.1%.
The modest declines followed last week’s record-high closes on Wall Street after the Federal Reserve trimmed interest rates. Yet optimism has cooled as traders weigh how much further the Fed will ease. Markets are currently pricing in 44 basis points of cuts over the remainder of 2025, with two policy meetings still on the calendar.
Attention now turns to several Fed policymakers scheduled to speak this week. On Monday, John Williams, Thomas Barkin, and Stephen Miran are slated to give remarks. On Tuesday, speeches from Raphael Bostic, Michelle Bowman, and especially Chair Jerome Powell will be closely monitored for clues on policy direction.
Inflation and Global Policy in Focus
Friday’s release of the U.S. personal consumption expenditures (PCE) price index—the Fed’s preferred inflation measure—will headline the week. Economists expect a modest uptick, with annual inflation rising to 2.8% in August from 2.6% the prior month, keeping the Fed’s 2% target out of reach.
Other global developments shaping sentiment include:
- Eurozone consumer confidence data for September due later Monday.
- The People’s Bank of China keeping its loan prime rate unchanged for a fourth straight month.
- Renewed U.S.–China dialogue, with progress made last week on TikTok’s U.S. operations.
- The Trump administration’s latest immigration policy requiring $100,000 fees for new H-1B visas, adding costs for U.S. employers.
Corporate and Commodity Moves
In corporate news, Swedish telecom giant Ericsson announced an eight-year, $1.3 billion contract to supply 5G infrastructure to VodafoneThree’s U.K. network. The deal follows the merger of Vodafone and CK Hutchison’s British operations, with plans to invest £11 billion ($14.8 billion) in 5G development over the next decade.
Energy markets also reflected heightened geopolitical risk. Brent crude rose 0.7% to $67.19 a barrel, while WTI gained 0.7% to $62.84. Oil benchmarks had fallen more than 1% Friday but were supported Monday by fresh tensions:
- Four Western nations formally recognized Palestinian statehood, adding instability in the Middle East.
- The European Commission proposed its 19th sanctions package against Russia, targeting shadow fleet vessels and energy traders breaching import bans.
These crosscurrents underscore the uncertain backdrop for European markets, where global monetary policy and geopolitical tensions remain the central drivers of investor sentiment.