Market Information Wednesday 3 December 2025

Eurozone inflation rose unexpectedly to 2.2% in November, exceeding the European Central Bank’s 2% target for the third consecutive month, driven by persistent services inflation, which climbed to 3.5%, its highest since April. Germany’s inflation also increased to 2.6%, while core inflation held steady at 2.4%. Despite this, ECB president Christine Lagarde signalled that current interest rates, set at 2%, remain appropriate, and markets expect no immediate cuts, with only a 30% chance of a reduction by June 2026. Unemployment edged up to 6.4%, and analysts described the inflation trend as slowing but fragile, reinforcing expectations that the ECB will maintain its stance at its 18 December meeting.

The EU has reached a landmark agreement on its first directive to harmonise criminal law on corruption across member states. The rules establish common definitions for offences such as bribery, embezzlement and obstruction of justice, and set minimum prison sentences, allowing countries to impose stricter penalties if they wish. Negotiations were fraught, particularly over whether abuse of office for personal or third-party gain should be criminalised, with Italy resisting due to concerns about vague definitions deterring officials from approving projects. Ultimately, member states will decide which serious breaches of public office to include in national law. The directive still requires formal approval by the European Parliament and member states before taking effect.

A consortium of ten major European banks, including ING and BNP Paribas, is launching a euro-backed stablecoin via the non-profit company Qivalis, with the first transactions expected by summer 2026. The initiative aims to strengthen European financial sovereignty and counter the dominance of US stablecoins, which regulators fear could undermine the euro and inflation control. Unlike US counterparts such as Tether, Qivalis will maintain a near one-to-one reserve ratio in cash and top-rated bonds, ensuring strict compliance with European regulations. The coin will support interbank payments, trade, and investment transactions, reducing costs and exchange rate risks. With the stablecoin market projected to grow from $300 billion to up to $3.7 trillion in five years, Qivalis positions itself as a trusted, regulated alternative to US crypto assets.

The 6M Euribor increased with 1 basis point to 2.12% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.79% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.