The European Central Bank lowered interest rates for the seventh time since last June, bringing the deposit rate to 2.25%. 

The widely expected cut comes as trade tensions threaten to derail the region’s economic recovery. “Downside risks to economic growth have increased,” President Christine Lagarde told reporters today in Frankfurt, stressing that it will still take time for the full consequences of US tariffs to become clear. 

The ECB also dropped the word “restrictive” from its statement in relation to the monetary-policy stance. But markets boosted bets on further cuts in borrowing costs as officials underscored the headwinds that Europe currently faces.

Having just weeks ago been pondering a pause in its easing campaign, the announcement by President Donald Trump of sweeping tariffs on the US’s trading partners tilted support within the ECB back toward a further reduction. — Jennifer Duggan

What You Need to Know Today

The head of Europe’s insurance watchdog said the US Treasury market’s recent volatility is bringing into question its status as a safe haven. Petra Hielkema, the chair of the European Insurance and Occupational Pensions Authority, made the comments last week as part of a presentation on behalf of EU financial supervisors, sources tell us. The striking assessment at a closed-door meeting hints at some of the nervousness about Treasuries, which have served as the world’s ‘risk-free’ asset.

Google was found by a federal judge to have illegally monopolized some online advertising technology markets in a blow to a key part of the company’s business. US District Judge Leonie Brinkema found on Thursday that the Alphabet unit violated antitrust law in the markets for advertising exchanges and tools used by websites to sell ad space, known as ad servers. Alphabet shares quickly sank as much as 3.2% on the ruling, while shares of Trade Desk soared nearly 8%.

Banca Monte dei Paschi di Siena’s shareholders authorized Chief Executive Officer Luigi Lovaglio to go ahead with his bid for Mediobanca. It takes him a big step closer to his goal of acquiring the rival lender. Some 87% of the bank’s investors attending the meeting today approved a motion that enables Lovaglio to issue new Monte Paschi shares as a way to fund the deal. The outcome now hands the baton to Mediobanca shareholders. 

A double-digit selloff in UnitedHealth Group is dragging down the blue-chip Dow Jones Industrial Average, pushing it toward a day of historical underperformance. The Dow Jones Industrial Average fell 1.2% today weighed down by a 18% plunge in UnitedHealth after the firm cut its annual forecast and reported its first earnings miss in more than a decade. The S&P 500 Index gained as much as 0.6%.

President Trump said Federal Reserve Chair Jerome Powell’s termination from his position can’t come quickly enough, arguing that the US central bank should have lowered interest rates already this year, and in any case should do so now. Trump wrote in a post on the Truth Social platform that “Powell’s termination cannot come fast enough!” It was not immediately clear if the post meant Trump was referring to the scheduled end of Powell’s term, or if Trump was seeking to remove Powell as chair. 

Eli Lilly shares surged after data showed its experimental weight-loss pill worked as well as the Ozempic shot, bringing it one step closer to developing a needle-free alternative. The trial is one of several that Lilly is running to test the drug, called orforglipron, in diabetes, obesity and other related conditions like sleep apnea. The trial showed patients lost 16 pounds, or 7.9% of their body weight, over a 40-week period. That compares favorably with Ozempic.

Turkey raised its main interest rate, a surprise move to reassure investors after domestic turmoil and US tariff uncertainty triggered a selloff in the lira. The Monetary Policy Committee hiked its one-week repo rate to 46% from 42.5%. Denmark’s central bank also lowered its benchmark interest rate by a quarter point to defend its peg to the euro in a move that matched its euro-area counterpart after recent turbulence in the financial markets.

What You’ll Need to Know Tomorrow

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