Week Ahead (4 August)

Monday, 4 August – Paris Court ruling on the legality of Altice’s debt restructuring agreement with implications for SFR and the telco consolidation debate

Today, the Paris Economic Court is expected to issue a ruling on the legality of Altice France’s February debt restructuring agreement. This decision could make or break the planned sale of SFR, France’s second-largest telecoms operator, and will carry major implications for telecom consolidation in France. More specifically, the court decision will determine whether SFR remains within the Altice restructuring perimeter.  In July, the public prosecutor called for the exclusion of SFR and two other Altice units (SFR Fibre and Completel) from the plan.

SFR’s owner, billionaire Patrick Drahi, has been trying to offload assets amid mounting pressure to reduce Altice’s €60+ billion debt load. Since May, growing interest has surrounded a possible sale of SFR, with both domestic and international players circling. Orange and Iliad are seen as the most likely French bidders, while international suitors such as Emirates Telecommunications Group (e&) and US private equity firm Blackstone have also reportedly explored the deal. Detailed financial data was circulated to prospective buyers in June, and while no formal bids have been tabled, sources close to the process say Drahi hoped to reach an agreement by late 2025, assuming debt restructuring stayed on track.

Therefore, if the court follows that recommendation, the deal with creditors could collapse. Drahi’s lenders have warned they would withdraw support under these terms, threatening the financial stability of Altice France and casting serious doubt on any SFR sale in the short term – Orange CEO Christel Heydemann told investors last Tuesday that Altice 's debt restructuring appears to be a "prerequisite" for a takeover of SFR.

Beyond commercial dynamics, any deal involving SFR will inevitably raise regulatory and political scrutiny since it would reduce the number of network operators in France from four to three. At the EU level, if a formal transaction is agreed, the deal will likely fall under the remit of DG Competition. This would make it one of the first major test cases for Competition Commissioner Teresa Ribera given that Brussels’ stance on telecom consolidation has been evolving, especially in light of the Draghi Report’s call for more flexible merger control to promote industrial scale and digital rollout.

In other words, the outcome of today’s court ruling could therefore determine not just the fate of SFR but also shape the next chapter in Europe’s telecoms consolidation debate. If the deal moves forward, it will provide early clues on whether the EU is genuinely turning the page on the hardline merger stance of previous years.

Thursday, 7 August – Bank of England likely to cut rates to 4% amid sticky inflation and weak labour market

On Thursday, the Monetary Policy Committee of the Bank of England will decide on interest rates. Markets are pricing in a 25 basis point rate cut that would bring the Bank Rate down to 4.00% from 4.25%, after the Bank opted to keep its rates steady at its previous meeting in June.

While inflation remains well-above the 2% target and labour market data continues to weaken, the decision is expected to reflect a delicate balancing act. This week’s meeting is expected to once again reveal a split between three camps within the MPC: the hawks pushing for a pause due to stubborn price pressures; the doves advocating for steeper cuts to shield the economy; and a centrist majority favouring a gradual easing path.

The backdrop to Thursday’s meeting is unusually complex: in June, headline CPI rose unexpectedly to 3.6%, up from 3.4% in May, with transport and fuel prices driving the monthly increase. Core inflation also ticked up, reaching 3.7%, while services inflation remained stuck at 4.7%. Although the Office for National Statistics (ONS) later clarified that some of May’s inflation increase was marginally overstated due to road tax input errors, the June print reinforced concerns that price pressures, particularly in core goods and services, are proving more persistent than previously hoped. Medium-term inflation expectations, a key metric tracked by the Bank, remain elevated.

At the same time, there are worrying signs of economic cooling. The UK economy contracted by 0.1% in May, marking the second straight month of negative growth. The downturn was driven largely by declining manufacturing output and a sharp drop in retail sales. Meanwhile, wage growth is easing, and unemployment has begun to creep up, adding to the dovish tilt among some MPC members.

Governor Andrew Bailey is likely to reiterate the Bank’s “gradual and careful” approach to monetary easing, emphasising that each decision is data-dependent and that rate cuts will not follow a fixed schedule. Policymakers are also set to report on the progress of the Bank’s quantitative tightening programme, with attention likely to focus on how gilt sales are impacting market conditions.

Although a cut appears highly probable, the path beyond August is less clear. Some economists expect one more cut in November, followed by a pause, while others argue that sticky inflation and lingering uncertainty around global trade and tariffs may force the Bank to slow its pace further.

Friday, 8 August – Trump’s latest Ukraine ceasefire deadline to Russia

This Friday marks the expiration of an ultimatum set by US President Donald Trump, who has demanded that Russia agree to a ceasefire in Ukraine by 8 August or face new economic penalties. The deadline, originally set at 50 days, was abruptly shortened earlier this week during Trump’s meeting with UK Prime Minister Keir Starmer. On Monday, the US President stated that he has shortened the deadline to “ten or twelve days”, warning that ‘’we’re going to put on tariffs’’ and ‘’other measures” if Moscow fails to show progress toward ending its full-scale invasion of Ukraine.

The new deadline escalates Trump’s efforts to portray himself as a global peacemaker, something he referred to as his “proudest legacy” in his second inaugural address. Trump has repeatedly vowed to end the war quickly, blaming his predecessor Joe Biden for failing to prevent Russia’s 2022 invasion and claiming he would have resolved the conflict on “day one” of his second term.

The Kremlin responded coolly to the ultimatum, with spokesperson Dmitry Peskov stating on Wednesday that Russia has “developed a certain immunity” to Western sanctions after years of restrictions. In a similar tone, foreign ministry spokesperson Maria Zakharova dismissed the threat as routine, arguing that sanctions “only serve to hurt Western economies”.

European leaders, who have privately and publicly pushed the Trump administration to intensify pressure on Moscow in recent weeks, will likely welcome a move of potential economic sanctions, although it may have unintended consequences on energy prices and supply chains. The EU has been advocating for a coordinated transatlantic front, hoping that it will push President Putin closer toward a negotiated ceasefire.

Nevertheless, nothing is set in stone. Trump has already shown a willingness to shift deadlines, as seen in the recent tariff talks with both the EU and China and his approach to the war remains unpredictable.