Boris Johnson Under Fire as He Stakes Leadership Claim

GBP

Boris Johnson has suffered a major setback in becoming the new Prime Minister, as he has been accused of misconduct in public office. Boris has been ordered to appear in court over claims he lied by saying the UK gave the EU £350m a week. A source close to Mr Johnson called the case a ‘politically motivated attempt to reserve Brexit’. The source close to Mr Johnson said the decision to summon him was "extraordinary" and "risks undermining our democracy".

There could be some good news for May’s successor as Donald Trump sees a post-Brexit trade deal with the UK as a priority according to his ambassador to London, Woody Johnson. Johnson went onto say “it’s foremost in the president’s mind and he would get it done as quickly as possible,” when speaking about a potential trade deal between the UK and the US. Johnson’s comments come ahead of Trump’s state visit to the U.K. next week, the last major event for May before she steps down on June 7. The freedom for the U.K. to negotiate its own trade deals was touted as one of the great boons of Brexit during the 2016 referendum campaign and Johnson believes a trade deal between the UK and the US could be ‘huge’ for both countries.

EUR

The ECB’s May financial stability report comes during a period of slow growth for the Eurozone, which has struggled with global trade tensions, Brexit negotiations, and a weak recent economic performance by Germany, Europe’s biggest economy. Luis de Guindos, vice president of the ECB went onto say “if downside risks to the growth outlook were to materialise, risks to financial stability may arise”. “The growth outlook is central to all the main risks to financial stability.

A long period of low growth in Europe is likely to see borrowing costs for countries and companies with high debts rise significantly, which could “unearth debt sustainability concerns”, the ECB warned. Furthermore, the ECB said although public debt in the zone overall has fallen, it has ‘continued to increase in some of the highly indebted’ hinting at Italy’s woes. Brussels and Rome have recently reignited their spat over Italy’s high levels of debt, with the country’s deputy prime minister Matteo Salvini yesterday calling on the ECB to “guarantee” countries’ debt to keep borrowing costs low.

Key Announcements

13:30 – USD: Preliminary GDP Q/Q – forecast at 3.1% from the previous 3.2%