No hay escasez de combustible de avión en Europa, dice jefe de transporte, a pesar del conflicto en Medio Oriente

The EU trade commissioner has said the growing deficit with China is unsustainable.

Speaking in Brussels, MaroÅ¡ Å efÄoviÄ described the mood among commissioners who met for a China debate last Friday ahead of a leaders summit on 18 June.

Å efÄoviÄ told the Brussels and European Policy Centre conference on economy security:

“I would say the underlying and common thought in everyone that the situation where we are accumulating trade deficits with China at the pace of 1 billion euros a day is clearly unsustainableâ€

“It cannot be in the situation that we could have 360 billion euros deficit.â€

But Å efÄoviÄ said they would look at re-engaging with China.

“We also have to look how to address not only the deficit, but I would say our overall relationship with China … [regarding] global over capacities as such.

“So I think that what we are looking at internally is, you know, how to improve the, I would say, diplomatic outreach communications and discussions with our Chinese partnersâ€

Å efÄoviÄ also pointed out that “Openness has to be reciprocated by your partnerâ€.

The contraction in the eurozone's economy in the first quarter of this year is awkward timing for the European Central Bank, which is expected to raise interest rates next week.

Economists predict a rate hike from the ECB, to fight inflationary pressures from the Middle East conflict.

Analysts at Unicredit explain:

The ECB is very likely to start hiking interest rates next week, with a 25bp increase on 11 June.

Several influential members of the Governing Council have already flagged the move, and the new macroeconomic forecasts will provide the background for the decision as the ECB's inflation projection moves to the 3% area for this year and towards 2.5% for next year.

Despite the inflationary pressures from the Iran war, Kazakhstan's central bank has cut the country's key interest rate to 17% from 18%.

The National Bank of Kazakhstan eased monetary policy after its forecast for inflation this year was revised down to 9-11%, from 9.5-11.5%.

Newsflash: the eurozone is on the brink of a technical recession, due to a slump in activity among multinationals based in Ireland.

Statistics body eurostat has reported that eurozone GDP fell by 0.2% in the first quarter of this year, following a rise of 0.2% in the fourth quarter of 2025. A technical recession is two quarterly falls in GDP in a row.

The decline was due to a 12.1% slump in Ireland's GDP, according to official data released yesterday. However, that was caused by a 27.1% slump across Ireland's multinational-dominated sectors, as a surge of demand for pharmaceutical products during 2025 unwound.

Ireland's modified domestic demand (MDD), a better measure of its domestic economy rose by 0.6%.

Eurostat, though, uses GDP, so here we are.

It also reports that Denmark (+1.9%) recorded the fastest quarterly, followed by Estonia and Malta (both +1.1%). At the bottom of the growth table, Ireland were followed by Lithuania (-0.3%), Sweden (-0.2%) and France (-0.1%).

Eurostat had initially estimated last month that eurozone GDP rose by 0.1% in Q1 2026, before Ireland's GDP slump hit….

India is set to launch a new high-ethanol fuel blend in the market, its latest effort to diversify supplies and reduce the country's reliance on imported oil, Bloomberg reports.

Oil minister Hardeep Puri is due to introduce the fuel today at an Indian Oil Corp.'s outlet in New Delhi. It will initially sold at 50 pumps in the country.

The South Asian nation currently sells 20% ethanol-blended gasoline, or E20, across its retail fuel network. The new blend, called E85, will contain about 85% ethanol and pollute less than its conventional counterparts. More here.

A majority of UK firms are expecting to hike their prices to pass on the cost of higher energy, but profits are still expected to be squeezed.

The Bank of England's latest poll of chief financial officers at small, medium and large UK businesses has found that 57% of firms expected to increase their prices, while 68% of firms expected their profit margins to be lower.

The Decision Makers Panel has also found that bosses expect to hand out smaller pay rises this year. They reported that annual wage growth was running at 4.2%, while expected year-ahead wage growth is only forecast to be 3.4%.

After rising in recent months, global food commodity prices stabilised in May.

The UN's Food and Agriculture Organisation has reported that its Food Price Index was stable last month, showing that the cost of a basket of food commodities dipped by 0.2% in May.

There were some notable price rises, though. The Sugar Price Index rose by 7.5% in the month, blamed on fears that supplies will tighten in coming months. Cereal prices rose by 2.6%, on expectations of weak harvests in major exporters, including the US, and higher fuel and fertilizer costs.

Meat prices were little changed, while vegetable oil and dairy prices fell in the month.

The jump in jet fuel costs has prompted American Airlines to join the list of carriers temporarily cutting routes.

On Wednesday, American told CBS News that it has adjusted schedules for “select routes†in August and September, due to elevated fuel costs.

The routes affected include flights from Los Angeles to Cleveland, Columbus, Pittsburgh, and Washington Dulles, and from Charlotte to Ontario, and to Sacramento.

Shares in UK low-cost computer firm Raspberry Pi have hit a record high, after it lifted its profit forecasts this morning.

Raspberry Pi's shares are up 14% to 937p, their highest level since the Cambridge-based company floated on the London stock market in 2024.

Raspberry Pi told the City that trading in the first half of this year has been strong, with profitability “materially ahead†of the first half of 2025, and that it has been running down stockpiles of memory chips (DRAMs) before prices surged this year.

It told shareholders:

Performance has been supported by continued growth in unit volumes, a favourable product mix, and the ongoing utilisation of low-density DRAM inventory accumulated throughout FY 2025.

It added that earnings this year are on track to be “significantly ahead of current market expectationsâ€.

Demand for Raspberry Pi's computers jumped this year after technology experts found that they were a good choice to run the OpenClaw AI chatbot.

The oil price is little changed this morning, with Brent crude trading around $95 a barrel.

Susannah Streeter, chief investment strategist at Wealth Club, says:

On the geopolitical front, conflicting messages from both Iran and the US have seen sentiment turn erratic. For now, oil prices are managing to stabilise around $95 a barrel, in the absence of a big reignition in the US military campaign.

But there remain big questions about how negotiations can meaningfully progress, especially with Israel's actions in Lebanon such a sticking point. Hezbollah rejected proposals for a ceasefire, and although there are now reports it's seeking fresh talks with the US, this will be a highly complex situation to resolve.

The US military action in Iran has opened a can of worms, with a slippery mix of geopolitical tensions escaping diplomatic attempts at containment, and threatening to unsettle markets further.

Sentiment in risk markets across Asia has soured today, as investors worry that the rally in technology stocks may be stalling.

South Korea's KOSPI share index has dropped by 5% today (trimming its gains in 2026 to around 90%!), as a drop in chip shares on Wall Street yesterday ripples across markets.

Chris Weston, head of research at Pepperstone, says:

Questions are being asked more intently about whether some of the blockbuster trades of 2026 have had their time in the sun and are due for consolidation, and whether this modest pullback could evolve into something more pronounced.

A second takeover battle has ended without success for the pursuer.

US-based Apollo Global Management has said it does not intend to make a firm offer for British thermal processing services company Bodycote, following talks between the two sides.

There's a little takeover drama in the City of London this morning: the company behind bookmaker William Hill is being acquired.

Evoke has agreed to be taken over by US casino operator Bally's Intralot, in a deal which values Evoke at £243.1m.

Bally's Intralot says the deal will create a “global gaming and lottery championâ€, with “significant scale and relevance in Europe's largest and most attractive gaming jurisdictionsâ€.

The two sides have been talking for weeks, and Bally's Intralot had been given a deadline of 5pm next Monday to reach a deal or walk away.

UK house prices have dipped again, as the jump in borrowing costs since the Middle East conflict began hits demand.

Lender Halifax has reported that house prices edged down -0.1% in May, the third monthly drop in a row after a 0.5% fall in March, and a 0.1% drop in April.

That pulled the average price, on Halifax's index, down to £298,806, from £299,251 in April.

On an annual basis, prices were 0.5% higher than in May 2025.

Amanda Bryden, head of mortgages at Halifax, says:

“Property price trends continue to reflect the uncertainty linked to developments in the Middle East. Despite recent cuts to mortgage rates, higher inflation expectations have kept borrowing costs above the level seen at the start of the year, continuing to stretch affordability for many buyers and temper demand.

“Even so, overall activity has held up well, reflecting the underlying resilience of the UK housing market. Latest industry figures show transaction levels remain relatively stable, suggesting buyers and sellers are still moving.

Greater numbers of UK consumers went shopping last month as spring sunshine brought welcome relief to retailers, which have faced a squeeze on spending since the US-Israel war on Iran.

Figures from the British Retail Consortium (BRC) and a separate survey by the accountancy firm BDO showed a bounce-back in footfall during May, reversing a sharp decline in April.

The recovery coincided with consumer confidence surveys showing a rise in May as shoppers began to get over the sharp rise in petrol and diesel prices linked to the Middle East conflict, which began in late February.

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

With summer approaching, holidaymakers have been growing nervous that the Middle East crisis might leave airlines short of fuel.

But despite the lack of progress to reopen the strait of Hormuz, the European Union's transport chief has insisted there are no signs of jet fuel shortages in Europe in the coming months.

Transport commissioner Apostolos Tzitzikostas has told Reuters:

“There is currently no jet fuel shortage in Europe. We have no signs that we will have a shortage in the coming period.â€

Tzitzikostas pointed out that current high jet fuel prices have prompted airlines to cut uneconomic routes (an example of the demand destruction created by high energy costs), saying:

“This is why we see that some airlines are choosing to cancel some of their routes that didn't make any economic sense.â€

In May, airlines cut two million airline seats from their schedules, or less than 2% of global aviation capacity.

Looking further ahead, Tzitzikostas suggested that the situation would be “very difficult†by the end of the year if Middle Eastern supplies remained disrupted.

“It's critical that the war stops and that the Strait of Hormuz opens and this needs to happen as soon as possible …. We should always keep in mind that Europe is prepared. We have the emergency stocks in our member states.â€

“For the time being, there is a certain degree of stability.â€

Back in April, the head of the International Energy Agency said Europe has only six weeks of jet fuel left before shortages will hit.

Seven weeks on, flights continue – as Tzitzikostas points out – but airlines have been raising ticket prices to pass on the cost of higher fuel, and also to dampen demand.

The agenda

• 7am BST: Halifax's UK house price index for May

• 8.30am BST: UN's FAO Food Price Index

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