FT News Briefing Will Germany ban the far-right AfD?
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May 22, 2025 Telegram's impressive $540 million profit amidst legal challenges is a surprising highlight. Meanwhile, Japan faces record-high bond yields as it shifts away from loose monetary policy. The UK grapples with a 15-month inflation peak, driven by utility bills. A major discussion centers on the far-right AfD party in Germany—can it be banned, or has it grown too powerful? This issue raises alarms about rising extremism across Europe and the challenges faced by politicians in maintaining stability amid public sentiment.
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Japan Bond Yields Impact Global Market
- Bank of Japan's tapering of bond purchases and normalization of interest rates caused long-term Japanese bond yields to surge.
- This movement triggered global concerns about demand for long-term sovereign debt and led to yield increases in other major markets.
Rising Yields Challenge Borrowers
- Rising long-term bond yields pose challenges for countries borrowing at record levels, increasing their interest payments.
- Governments try to balance issuing short-term versus long-term debt to manage borrowing costs and market functioning.
Rising UK Inflation Influences Rates
- UK inflation rose unexpectedly to 3.5% in April, driven by utility bills, taxes, and employer national insurance hikes.
- This inflation increase affects market expectations, reducing predicted interest rate cuts by the Bank of England.