News about Europe

European stocks were seen opening lower on Monday as mass protests in France escalated into riots, adding to an already elevated fiscal risk premium. The euro fell against most G10 peers due to the protests in France and rising tensions in Ukraine. French President Emmanuel Macron called for 'calm and order' after a major day of protests on Saturday turned into rioting and looting.

China's economy grew 4.5% in the July–September quarter from a year earlier, faster than the 4.3% in April–June, which was the slowest pace in more than three years, thanks to robust exports. The annual growth target is 4.5%–5%, down from 5% last year, and the IMF has trimmed its forecast for China's 2026 growth to 4.5%. Domestic demand remains weak amid a prolonged property slump, while exports rose 36% last month and the trade surplus reached $938 billion from January to September, putting China on track to surpass last year's record $1.2 trillion. The EU, which runs a trade deficit with China of more than $1.1 billion a day, has agreed with Beijing to roughly halve Chinese hybrid vehicle imports over the next few years, though economists say trade imbalances will be hard to resolve quickly.

Think tank IPPR urged Britain to make EU membership its 'medium-term' goal, arguing that the UK lacks the scale to handle Russian aggression, American unreliability and Chinese coercion on its own. Ahead of the UK-EU summit in Brussels, where Prime Minister Andy Burnham will set out relationship options, IPPR said 'hedging' between the US and Europe was a strategy for survival rather than success. A Persuasion UK poll found 52% of people backed rejoining against 29% opposed, though budget contributions and replacing the pound with the euro could damage that support. The government responded that the current Brexit deal had weakened immigration control and growth.

Tens of thousands of people took to the streets across several European cities over the weekend to protest rising living costs, housing shortages and strained public services. In France, some 550,000 people joined nationwide demonstrations on Saturday, which quickly turned violent, leaving 997 police officers and gendarmes injured, seven seriously, and 2,397 people arrested nationwide. In Milan, Italy, protesters threw firecrackers and bottles at police, injuring at least four officers and 20 demonstrators, with about 50 detained. Clashes also broke out in Brussels, and tens of thousands marched in Portuguese cities demanding affordable housing. Analysts warn that failing to address these hardships risks further eroding public trust and deepening social divisions.

Tens of thousands of people across major European cities protested over the weekend against rising living costs, housing shortages and strained public services. In France, about 550,000 people joined nationwide demonstrations on Saturday that turned violent, with 997 police officers and gendarmes injured, seven of them seriously, and 2,397 people arrested. Clashes also broke out in Milan and Brussels, with about 50 demonstrators detained in Milan, while tens of thousands rallied in Portugal demanding affordable housing. European leaders condemned the violence, and a Eurofound senior research manager said the benefits of macroeconomic stability are failing to reach the bottom half of the income distribution.

The European Central Bank has developed two new quarterly indicators to monitor euro area banks' vulnerabilities between regular stress tests. The Stress Vulnerability Index (SVI) estimates how much bank capital could be depleted under adverse scenarios, while the Profitability Vulnerability Index (PVI) assesses pressure on current earnings and banks' ability to generate capital internally. Both indices rose during the global financial crisis and the European sovereign debt crisis, and both were strongly associated with the likelihood of banks receiving state aid. The paper supports a cautious approach to maintaining capital buffers, since the SVI stayed slightly elevated even as profitability improved.

Tens of thousands of people marched across European cities over the weekend, protesting surging living costs, housing shortages and strained public services. In France, about 550,000 people joined nationwide demonstrations on Saturday, and clashes left 997 police officers and gendarmes injured and 2,397 people arrested. In Milan, four officers and 20 protesters were hurt and about 50 people were detained, Brussels saw clashes, and tens of thousands in Portugal demanded affordable housing. French President Macron and Italian Prime Minister Meloni condemned the violence and vowed to prosecute those responsible. Eurofound's Eszter Sandor warned that the benefits of macroeconomic stability are not reaching the bottom half of the income distribution, eroding trust in governments.

Think tank IPPR says Britain should make EU membership its medium-term goal as Andy Burnham prepares to outline options for the UK's relationship with Europe at the UK-EU summit in Brussels on November 20. The report argues that Britain lacks the scale to handle Russian aggression, American unreliability and Chinese coercion alone, and that hedging between the US and Europe is a strategy for survival rather than success. It suggests first building support through cooperation on defence, manufacturing and democratic resilience, and possibly joining the EU's Made in Europe scheme, without an immediate referendum. Polling for the think tank found 52% of people back rejoining the EU, compared with 29% opposed. The Government says the Brexit deal it inherited has weakened border control and growth.

Tens of thousands of people rallied across major European cities over the weekend against rising living costs, housing shortages and strained public services. In France, nationwide protests on Saturday drew about 550,000 people and turned violent, with 997 police and gendarmes injured and 2,397 people arrested. In Milan, protesters threw firecrackers and bottles at police, leaving at least four officers and 20 protesters hurt, while clashes also broke out in Brussels and tens of thousands in Portugal demanded affordable housing in Lisbon and Porto. Leaders including French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni condemned the violence. Eszter Sandor, a senior research manager at Eurofound, warned that the benefits of macroeconomic stability are not reaching the bottom half of the income distribution, deepening public distrust.

In a keynote speech at the Green Swan 2026 Conference in Manila, ECB Executive Board Member Frank Elderson argued that climate change and nature degradation will continue to shape economies. He noted that summer 2026 was the warmest ever recorded in Western Europe, with severe droughts, wildfires and very low river levels affecting transport, industry and energy production. Europe is warming more than twice as fast as the global average, and tens of thousands of excess deaths were linked to extreme heat during the summer months. He argued that climate and nature-related shocks add up and can leave lasting economic scars, such as reduced labour productivity, damaged infrastructure and output that stays below trend for years. These events have also already pushed up wholesale electricity prices and continue to influence food prices.

The IPPR think tank urges Britain to make EU membership its medium-term goal as Prime Minister Andy Burnham prepares to set out relationship options at the UK-EU summit in Brussels on November 20. The report says Britain lacks the scale to face Russia, the US and China alone, and that balancing between the US and Europe is a strategy for survival rather than success. It proposes working with the EU on defence and manufacturing, including possible inclusion in the 'Made in Europe' scheme, as steps toward membership, while noting the government needs time to build the case. Polling in June found 52% support for rejoining and 29% opposition, though concerns over EU budget contributions and replacing the pound with the euro could significantly damage support. A government spokesman said the threadbare Brexit deal has weakened control of illegal immigration and tangled businesses in red tape.

The think tank IPPR says Britain should make EU membership its medium-term goal as Andy Burnham sets out options for the country's relationship with the bloc at the UK-EU summit in Brussels on November 20. The report argues Britain lacks the scale to handle Russian aggression, American unreliability and Chinese coercion alone, and that hedging between the US and Europe is a strategy for survival rather than success. It proposes working with the EU on defence, manufacturing and democratic resilience as steps toward membership. It also warns that joining the EU's 'Made in Europe' scheme could require aligning with EU tariffs on Chinese electric vehicles, potentially putting net zero targets at risk. Polling by Persuasion UK in June found 52% of people support rejoining and 29% oppose, though concerns about EU budget contributions and replacing the pound with the euro could damage support.

Russian President Vladimir Putin has signed a decree ordering the compulsory seizure of assets belonging to five Western companies: Tarkett (France), Kappa Rus, Ontex RU, Eviosys Packaging Kuban and Menshen Packaging CIS. The assets have been placed under temporary management by Centre Capital, and all five companies continue operating in Russia, with combined annual revenue above 50 billion rubles (593.8 million USD). This follows a similar series of moves in September, when assets of Nestlé, Metro, Auchan and Leroy Merlin were placed under temporary management. Western governments call the seizures illegal expropriation; affected companies could seek compensation through international arbitration under bilateral investment treaties, but enforcing a ruling against the Kremlin is nearly impossible.

Hundreds of thousands of people protested across Belgium, France, Italy and Portugal on October 17-18 over rising living costs. In France, the Interior Ministry counted over 550,000 participants, and the marches turned violent, with looting in several cities, a fire that nearly destroyed the 140-year-old Limoges city hall, and 1,200 arrests and 150 injured police, according to Prime Minister Sebastien Lecornu. Police used tear gas and water cannon in Brussels and Liège, while tens of thousands marched in Lisbon over housing costs and low wages. In Milan, clashes left at least 2 officers injured and about 50 people arrested, many of them minors, and Prime Minister Giorgia Meloni condemned the violence. Alberto Alemanno of HEC Paris said discontent is spreading, with early signs of protests in Greece, Germany and Austria expected next week, as Europe prepares for a major run of national elections in the next 12 months.

Russian Deputy Prime Minister Alexander Novak warned that Europe will struggle to fully make up for lost gas supply if it keeps cutting Russian volumes, amid instability in the Strait of Hormuz and disrupted production at a Qatari LNG facility that halted after attacks in March. He said the EU's LNG import ban, effective January 1, 2027, makes little sense while supply is tight, and that European consumers would bear the consequences. Novak estimated European gas reserves are about 10% below the average of previous years, and Reuters forecasts storage will reach only about 75–78% of capacity by November, well below the five-year average. Still, Russia supplied about 12 million tonnes of LNG to Europe in the first nine months of 2026, higher than a year earlier, as European buyers rush to purchase and stockpile before the ban. The EU has adopted a roadmap to end Russian gas imports, banning long-term LNG contracts from January 1, 2027 and phasing out pipeline gas during 2027.

Hungarian Prime Minister Peter Magyar expects U.S. President Donald Trump to keep extending Budapest's exemption from U.S. sanctions on Russian energy, after Trump eased curbs on Russian diesel exports to lower fuel prices before the Nov. 3 midterm elections. The deal drew criticism in the EU, with Italian PM Giorgia Meloni calling it a ‘very risky’ gamble, while Bulgarian PM Rumen Radev backed it. Moscow pledged 300,000 tons of diesel immediately and another 500,000 tons next month. Hungary, which relies on Russia for about 90% of its crude oil according to S&P Global data for 2025, is exempt until November, and Magyar argued that not extending the exemption for at least another year would be unreasonable. Ukraine opposed the deal, with President Zelensky calling it ‘weak’.

According to The New York Times, the US plan for Ukraine peace calls on Europe to buy more Russian gas, while Ukraine may consider reopening pipelines that once carried gas to the EU. The proposal is tied to broader issues, including Russia–NATO relations, security guarantees for Ukraine and territorial questions. Russian gas transit through Ukraine was halted in January 2025, leaving TurkStream as the only remaining pipeline route to the EU. Russia's share of EU gas imports fell from about 45% before 2022 to around 12% in 2025, yet the EU bought 36 billion m3 of Russian gas last year, including LNG estimated at €7.2 billion. The EU has begun phasing out some Russian pipeline contracts and plans to ban Russian LNG from January 2027 and pipeline gas from September, aiming for full elimination by the end of 2027.

The 2026 Paris Auto Show was bigger than past editions despite absences from BMW, MG and most Japanese OEMs, with Chinese brands such as BYD, Geely and XPENG showing affordable, tech-packed EVs. European carmakers are responding with faster EV development, sharper pricing and retro-inspired designs, including a revival of the city car segment that Chinese OEMs have largely avoided because EU tariffs squeeze its thin margins. The author singles out the new Smart #2, a two-seater with a 36 kWh LFP battery, a 290 km WLTP range and a 308-liter trunk, priced from 20,000 euros, and estimates it could sell around 40,000 units a year. The Citroën 2 CV revival, priced at 15,000 euros, will only begin deliveries in 2028, which the author sees as a drawback.

Ukrainian President Volodymyr Zelensky has asked European partners for at least 70 billion euros more for 2027 to fund defense, equipment and resilience, on top of a 90 billion euro loan already agreed for 2026-2027, and estimated the 2027 war will cost 155 billion euros. The EU has planned about 45 billion euros for 2027, and the European Commission acknowledged a funding gap but has not decided how to raise the extra money. Options including new loans, market borrowing backed by the common budget, frozen Russian assets or third-country contributions all face legal, political or burden-sharing obstacles. Czech Prime Minister Andrej Babiš said Czechia will not guarantee the funds, while Swedish Prime Minister Ulf Kristersson called a nearly 60% rise in Sweden's net EU budget contribution “completely unacceptable” and said a small group of countries cannot keep carrying a growing burden.

On October 15 in Brussels, ahead of an EU summit, Latvian Prime Minister Andris Kulbergs urged Europeans to help Ukraine by giving up a small expense, comparing the cost of aid to drinking one less beer per year. He said Ukraine needs the money now, as this winter is decisive, and framed aid as a shared European interest rather than a personal financial inconvenience. He also called for tougher sanctions against Russia. Earlier in October, Latvia approved humanitarian aid including medical equipment and ambulances, and its Economy Ministry plans to use remaining funds to buy 12 more diesel generators for Ukraine. Meanwhile, EU leaders are discussing Ukraine’s financial needs for 2027 amid disagreements over the joint budget, high energy prices and resource allocation, and the article notes that such contributions alone will not resolve Ukraine’s financial gap.

European allies of Saudi Arabia are struggling to supply additional air defense systems because they need them for their own defense, according to The National, citing military analysts. Saudi Arabia is pressing for more equipment to counter Houthi attacks in Yemen, but the UK and France reportedly cannot transfer systems without weakening their defenses in the Baltic states, and many Western stockpiles have run low due to commitments to Eastern Europe and Ukraine. A Houthi missile attack on King Khalid International Airport in Riyadh killed 12 people and injured 309, and the airport has been targeted at least four times. As a result, the planned summit between GCC states and the European Union has been postponed.