Brussels Edition: Donald Goes Home

(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

European Council President Donald Tusk gives a lecture in Warsaw today to rally pro-EU forces in the bloc’s upcoming Parliament elections. While Tusk — who is seen by Poland’s populist government as public enemy number one — hasn’t revealed his political plans after his tenure in Brussels comes to an end this year, the title of his speech, “Hope and Responsibility, the Constitution, Europe and Free Elections,” signals that he’ll take aim at those eroding democratic values, including in his homeland.

What’s Happening

Wrong Inflation | Data due today will probably show euro-area inflation accelerated to the fastest pace since late last year, which should come as good news for European Central Bank officials — unless prices rose for the wrong reason. Numbers from Germany showed travel costs skyrocketed due to the Easter holidays, a development likely to unwind next month.

Transparent Trade | The European Commission will today share details of a proposal it made last week at the World Trade Organization on rules that govern the huge e-commerce market. The move reflects heightened EU sensitivity to calls for transparency in trade talks amid a populist backlash against globalism.

Orban’s Invite | Donald Trump invited Hungarian Prime Minister Viktor Orban to a meeting on May 13, ending years of U.S. isolation for the nationalist leader. Orban, who has flouted democratic norms at home and built close ties with Russia and China, was the first European premier to publicly support Trump’s presidential bid and has praised the president’s “America First” policy.

Week Ahead | EU leaders will gather in Sibiu, Romania, next Thursday to discuss the bloc's future at a summit that has been promoted with much fanfare in Brussels, but has barely registered outside the bubble. Even with the Brexit delay, the meeting will be the first in a while that isn’t expected to be dominated by the bloc’s divorce with Britain.

In Case You Missed It

Greece Pays | Greece set in motion the procedure to repay pricier loans from the International Monetary Fund ahead of schedule by asking for the euro-area’s blessing. No country voiced an objection to the request, clearing the first hurdle in a process that could help Greece return to normalcy and facilitate its plans to sell more debt.

No Plan B | The merger between Germany’s two biggest lenders was always a long shot. So now that talks with Commerzbank collapsed, you would think that Deutsche Bank would have a Plan B. Well, with the risk of a potentially catastrophic downgrade in its credit rating looming, it turns out that it has virtually no proposal for what to do next.

Sinking Shipyards | Europe’s historic shipbuilding centers find themselves at risk of extinction, unable to compete with Asia and desperate for investment. James Gomez and Jasmina Kuzmanovic report from the Croatian port of Pula, where a once thriving shipyard now pins its hopes on a possible Chinese takeover to avoid a sudden death.

Hard Cheese | Producers of Spain’s Queso Manchego won a boost at the EU’s top court yesterday after they kicked up a stink over the way rivals may have labeled products to look like the world-famous cheese. Having other producers — even from the same region — use such names and labels could violate the so-called designation of origin that protects Queso Manchego, the court said in a binding decision.

Chart of the Day

Brussels Edition: Donald Goes Home

The euro area’s manufacturing slump showed tentative improvement in April as Italy’s contraction slowed markedly and French industry stopped shrinking. A Purchasing Managers’ Index came in at 47.9 in April, up from March and a touch above both economists’ estimates and a previous reading for the month. It was still below 50, the level that would indicate expansion.

Today’s Agenda

All times CET.

  • 10 a.m. EU antitrust chief Margrethe Vestager, an ALDE candidate for a potential EU top job, will be interviewed live on Bloomberg TV
  • 11 a.m. Eurostat to release euro-area flash inflation reading for April 
  • 12 a.m. Donald Tusk at celebration of the 228th Anniversary of the Polish Constitution, National Day of the Third May, gives lecture at the Warsaw University at 2 p.m. 
  • EU foreign policy chief Federica Mogherini delivers a speech in Florence at the State of the Union 2019 organized by the European University Institute

©2019 Bloomberg L.P.