EUR News
LAST UPDATE: June 11, 2025
EU removes UAE from ‘high-risk’ money‑laundering list, adds Monaco
The EU has removed the UAE from its high-risk anti–money laundering list, citing compliance improvements, while adding Monaco for its deficiencies.
Insight
Removing the UAE signals recognition of its efforts to tighten financial controls and align with international AML standards. However, adding Monaco shows continued concern over jurisdictions that remain hotspots for illicit financial flows. This dual move reflects both reward and vigilance in EU financial diplomacy. It may boost the UAE’s appeal to global investors, while Monaco faces reputational headwinds. Overall, it marks a recalibration of the EU’s financial crime risk map with targeted consequences.
EU investigates alleged Chinese tariff dodging as it hikes plywood duties
The EU opened an investigation into Chinese exporters accused of disguising hardwood plywood as softwood to evade anti‑dumping duties, while imposing provisional tariffs up to 62.4%.
Insight
This probe highlights the EU’s increasing vigilance against sophisticated tariff circumvention tactics. By targeting disguised wood imports, Brussels is protecting domestic plywood producers hurt by China’s market share gains. The investigation also mirrors broader strategic trade disputes, following earlier tariffs on Chinese EVs and tyres. The outcome could reshape EU–China trade dynamics, and signal how the EU enforces its trade defenses moving forward.
Czech Central Bank Says Inflation Still Warrants Cautious Policy
The Czech central bank noted that persistent service-sector inflation requires a cautious monetary policy stance.
Insight
Despite recent rate cuts, inflation in services remains sticky, suggesting continued pressures on household budgets. The central bank is balancing its easing cycle against inflation resilience. This cautious tone may temper market expectations for aggressive policy loosening. It reflects concerns that premature easing could reignite price pressures, especially across non-tradable sectors.
Czech government installs new minister after bitcoin scandal
Prime Minister Petr Fiala appointed Eva Decroix as justice minister following the resignation of Pavel Blažek over a $45 million bitcoin donation from a convicted criminal.
Insight
The appointment aims to restore credibility after the scandal, signaling urgency in transparency and trust‑building. The government’s move to audit and investigate the donation indicates a proactive response to public backlash. However, the scandal risks undermining coalition stability with a forthcoming no‑confidence challenge and election on the horizon. The episode reveals vulnerabilities in anti‑money laundering oversight amid rising use of cryptocurrencies.
Turkish o/n rate seen at 49% on Tuesday despite higher repo funding, traders say
Traders expect Turkey’s overnight interest rate to remain at around 49%, even after the central bank increased one-week repo funding.
Insight
The central bank is maintaining extremely high overnight rates to support the lira and contain inflation, despite hinting at rate cuts this summer. This dual strategy—tight overnight funding while planning easing—reflects the challenges of cooling inflation (still ~35%) without destabilizing financial markets. Bank shares have responded positively to this measured approach. It underscores continued volatility in Turkey’s monetary policy path.
Romanian president could nominate a prime minister this week
President Nicușor Dan said he may nominate a prime minister this week, but only if pro-EU parties agree on a credible deficit-cutting plan.
Insight
The delay in nominating a PM highlights deep-rooted divisions over how to tackle Romania’s EU-highest budget deficit. Dan favors spending cuts over tax hikes, giving priority to austerity measures and restructuring state outlays. But analysts warn that without revenue-generating reforms, the deficit—over 9% of GDP—will persist. Credit rating agencies have already flagged downgrade risks, pressuring the government to act swiftly. As the June end deadline approaches, political consensus on reform remains elusive, threatening both investor confidence and access to EU funds.
Polish president-elect says he had “good conversation” with U.S. president
Poland’s newly elected president-elect Karol Nawrocki spoke of a “very good” phone call with former U.S. President Trump, discussing close alliance relations and an invitation to meet.
Insight
Nawrocki’s outreach to Trump reflects Poland’s desire to leverage strong personal ties with the U.S., blending pro-U.S. nationalism with European diplomacy. By inviting Trump to Poland and receiving a reciprocal invitation, Nawrocki seeks high-profile endorsement. However, this “pro-Trump” stance may raise eyebrows in Brussels, as analysts warn it could complicate Warsaw’s alignment with EU positions, especially on Ukraine policy. It also indicates a nuanced balancing between maintaining U.S. security assurances and navigating EU integration expectations.
‘Her challenge is the voters’: Can Rachel Reeves’ spending review rebuild her reputation?
Chancellor Rachel Reeves is preparing a Spending Review aiming to boost public investment—backtracking on pensioner winter fuel cuts—and demonstrate purposeful fiscal strategy.
Insight
Reeves faces the political challenge of proving to voters that her fiscal discipline is purposeful and beneficial. By restoring winter fuel payments and announcing £113 bn in capital investment—including a £39 bn affordable housing plan—she seeks to shift narrative from austerity to strategic growth. However, internal party tensions remain over spending cuts in unprotected areas, and critics warn that without tax clarity and compelling direction, the review risks reinforcing public disenchantment. The outcome will test Labour’s ability to reconcile financial responsibility with delivering tangible benefits.
