Week Ahead (14 April)

Tuesday, 15 April – Conclusion of French government consultation process on meal voucher reform 

The French Ministry of Finance’s public consultation on reforms to the meal voucher system will conclude tomorrow, marking the end of stakeholder engagement before the launch of technical and legal reviews in May. In past months, key industry groups, particularly small businesses and hospitality representatives, have strongly pushed for the introduction of a commission cap of around 2%, citing high merchant costs and operational burdens, given that Edenred, Pluxee, Up, and Swile still controlled 99% of the market in 2023, per the French Competition Authority.  

Despite initially being sceptical, the Ministry last month indicated openness to this possibility, stating “all avenues are being explored” including commission reductions and reiterated that discussions were underway with industry stakeholders regarding this reform. 

Other proposals floated included adjusting the daily spending cap based on VAT rate, €8 for 5.5% VAT items like bread, up to €25 for 10% VAT products like meals.  In any case, the increasingly vocal demands from industry players indicate momentum toward introducing some form of limit on commission fees. A final decision is expected before summer. 

Wednesday, 16 April – European Commissioners to convene for inaugural ‘’Security College’’ 

On Wednesday, European Commission President Ursula von der Leyen will chair the inaugural session of the newly established ‘’Security College’’ bringing together all 26 Commissioners for a strategic discussion on the evolving security landscape and Europe’s preparedness across all policy areas.  

The new format, announced last month, is designed to institutionalise regular cross-portfolio updates on security risks, from hybrid threats and energy vulnerabilities to defence, cyber and critical infrastructure resilience. Von der Leyen stressed that the College will move beyond conventional definitions of security, reflecting how “any policy area can be weaponised”, citing past shocks like the EU’s overdependence on Russian energy and Belarus’ instrumentalisation of migration. 

This week’s meeting will serve as a basis for a more coordinated Commission-wide approach to internal and external security challenges. The first session will likely focus on the implementation tracks of ReArm Europe and the recently published White Paper on Defence, two flagship initiatives unveiled in recent weeks aimed at addressing decades of underinvestment in Europe’s defence base. 

ReArm Europe proposes a €150 billion joint effort to ramp up defence industrial production while the White Paper outlines long-term scenarios for greater EU defence coordination, including procurement, interoperability, and the future governance of joint capabilities. Wednesday’s meeting is expected to assess how to operationalise these efforts, including the planned European Defence Industry Programme (EDIP) and tools to stimulate joint procurement, especially as divisions remain over whether EU funds can be used for purchases from non-EU suppliers. 

Wednesday, 16 April - UK monthly inflation figures to be published  

UK consumer price monthly inflation figures for the month of March will be published this week, offering a good indication of inflation dynamics ahead of the Bank of England’s next policy meeting on 8 May. 

The data will come amid ongoing uncertainty over the UK’s inflation trajectory. In February, annual CPI inflation eased to 2.8%, down from 3.0% in January. However, the Bank of England (BoE) has also warned that inflation is likely to rise again in the months ahead, driven by higher regulated utility prices, energy costs, and broader supply-side pressures. 

The Monetary Policy Committee voted 8–1 in March to keep the Bank Rate unchanged at 4.5%, following a 25-basis point cut in February. The majority flagged concerns over sticky inflation expectations and upside risks to headline inflation later in the year. In the aftermath of the meeting, Chief Economist Huw Pill continued to stress caution, while the latest BoE survey showed a jump in public expectations for inflation over the next five years. 

Adding to the MPC’s dilemma is the external shock from rising global trade tensions. As part of his wider “Liberation Day” tariff package, President Trump imposed a 10% blanket tariff on nearly all UK goods entering the US, along with separate 25% duties on steel, aluminium, and automobiles. Although the broader global tariffs were temporarily paused on 10 April for 90 days, the UK-specific duties remain in place, a decision that will likely affect UK exports and growth in Q2 2025. 

Last week, Bank of England Deputy Governor Sarah Breeden warned that the US measures represent “the most significant change in U.S. trade policy in a century,” and are likely to dampen UK growth through weaker global demand, trade diversion, and potential supply chain disruption. However, she also noted that the inflationary impact is “not clear cut” leaving the Bank’s next move highly data-dependent. 

Thursday, 17 April – Italian Prime Minister Meloni heads to Washington for tariff talks 

Italian Prime Minister Giorgia Meloni will travel to Washington on Thursday for a meeting with President Donald Trump aimed at de-escalating the ongoing transatlantic trade conflict.  

Meloni is likely to propose the mutual elimination of industrial tariffs between the EU and the US – as proposed by European Commission President Ursula von der Leyen. 

The meeting comes after a series of rapid developments in the EU-US trade dispute. On 2 April, the US imposed sweeping new “reciprocal tariffs” of 20% on EU exports, in addition to the March tariffs of 25% on steel, aluminium, and automobiles. According to DG Trade’s preliminary assessment, these measures would affect approximately €380 billion in EU exports, about 70% of total EU goods trade with the US, with estimated duties exceeding €80 billion. 

In response to the March tariffs on steel and aluminium, the EU agreed on 9 April to impose retaliatory 25% tariffs on €21–22 billion worth of US goods, targeting politically sensitive products such as soybeans, orange juice, motorcycles, cereals, and chewing gum. These were intended to be rolled out in three stages, beginning on 15 April. 

However, shortly after the EU’s announcement last Wednesday, President Trump unexpectedly suspended the implementation of the “Liberation Day” tariffs, including the 20% reciprocal tariffs on EU exports, replacing them with a provisional 10% rate for a 90-day negotiation period, albeit his 25% tariffs on steel, aluminium and cars remain in place. The decision followed growing pressure from Republican lawmakers, market turbulence, and concerns over potential recessionary effects. 

As a result, the following day, Commission President von der Leyen confirmed that the EU would reciprocate by suspending its own countermeasures (which were agreed in response to Trump’s steel and aluminium tariffs) for the same 90-day period. More specifically, she stated that “we want to give negotiations a chance’’, before warning that “if negotiations are not satisfactory, our countermeasures will kick in.” Nevertheless, over the weekend, US Commerce Secretary Howard Lutnick warned that tariffs on semiconductors and electronics, as well as on pharmaceuticals, ‘’are coming in probably in a month or two’’. 

The EU’s decision reflects a broader strategic effort to de-escalate tensions and preserve leverage in upcoming negotiations. Brussels is continuing to prepare additional countermeasures, including potential deployment of the Anti-Coercion Instrument (ACI) and digital policy tools, if talks fail to yield a balanced outcome within the current window.  Italy was one of the countries arguing against the deployment of the ACI and due to its size can help form a blocking minority which would prevent its deployment (15 Member States representing 65% of the EU population must agree).   

Meloni’s visit had been seen as a key litmus test for the ACI – had she left the meeting convinced that a deal was possible then the ACI remained a distant prospect.  On the contrary, had she left the White House convinced that Trump was not for turning, continued pressure from France and Germany may have seen her switch sides and support its deployment.   

Given that the situation has improved somewhat since Trump’s reversal and the EU decision to suspend its own response, Meloni’s visit is now seen as an opportunity to further stabilise the situation and test the scope for a broader agreement. Notably, Italy has an important stake in transatlantic trade: roughly 10% of Italy’s exports go to the US, and key sectors such as food, wine, pharmaceuticals and automotives will be hit hard if the announced tariffs are to be ultimately enforced. 

Thursday, 17 April – ECB governing council to meet with another rate cut priced in 

The European Central Bank’s Governing Council (GC) will meet on Thursday for its third monetary policy session of the year, with a third consecutive rate cut widely expected. According to the latest Reuters poll (7–9 April), 61 out of 71 economists forecast a 25-basis-point reduction in the deposit rate, bringing it from 2.50% to 2.25%. Markets are also pricing in a further cut by June, as growth fears outweigh inflation concerns across the euro area. 

In March, the ECB cut rates by 25 basis points, its second cut this year and sixth since June 2024, citing weak growth, trade tensions, and softening price pressures. Crucially, the ECB also adjusted its forward guidance, dropping its reference to a “restrictive” stance and instead describing the policy as “meaningfully less restrictive.” While the shift was interpreted as a sign of growing caution about the pace of easing, the March decision was supported by all Governing Council members except one. 

Since then, however, inflation has continued to ease. Euro area annual inflation dropped to 2.2% in March, according to Eurostat’s flash estimate, down from 2.3% in February, putting it just above the ECB’s 2% target. Meanwhile, uncertainty linked to US trade policy has intensified. President Trump’s “Liberation Day” tariffs, announced on 2 April, triggered market volatility and raised fears of a recessionary shock. Although Trump has since suspended the most sweeping tariffs for 90 days, key duties on EU steel, aluminium remain in place. 

ECB officials have openly acknowledged these risks. In an interview with the FT last Monday, Greece’s Yannis Stournaras warned that the looming trade war would expose the Eurozone to a large ‘’negative demand shock’’, resulting in significant deflationary pressures. In a similar spirit, Finnish central bank governor Olli Rehn said last Wednesday that “many of the risks identified in March have now either materialised or are materialising” adding support for a rate cut in April. Besides the two potential rate cuts in April and June, markets will be assessing the possibility of additional easing in the second half depending on how the external environment evolves. 

Although the ECB will continue to monitor wage growth and core inflation dynamics, it appears that in the short-term growth fragility and external shocks, rather than inflation, will be driving the ECB’s thinking.