European markets are set to open lower on Friday as investors monitor political turmoil in the U.S. and monetary policy decisions from various major economies.
The FTSE 100 is slated to open 110 points lower at 8,088, according to data from IG, with Germany’s DAX to lose around 400 points to19,835, and the French CAC 40 is expected to shed 140 points to 7,244.
The United States was plunged into fresh political uncertainty on Thursday evening, after the failure of a Trump-backed spending bill, whose passage would have prevented a government shutdown. Dozens of Republican lawmakers voted against the deal to fund the government for three months and suspend the U.S. debt ceiling for two years, meaning a partial government shutdown will commence on Friday night.
Elsewhere, China held its key interest rates steady Friday, in line with expectations. The move came in the same month that Beijing’s top officials vowed to ramp up policy easing measures.
The latest development from the People’s Bank of China arrived in the same week as monetary policy updates from the Federal Reserve and the Bank of England. On Wednesday, the Fed announced a 25-basis-points cut to its core interest rate, while the Bank of England held policy unchanged at its own Thursday meeting.
While the Bank of England’s decision was widely anticipated, a split in the vote and Governor Andrew Bailey’s comments about the economic impact of the newly elected Labour government’s budget rattled markets, sparking a dip in the value of the British pound and yields on Britain’s 10-year Gilts to tick higher.
Russian policymakers are set to update their monetary policy on Friday.
The U.K.’s retail sales for November, France’s November Producer Price Index, and the current state of consumer confidence in Italy will also be released on Friday.
— CNBC’s Christina Wilkie, Sonia Heng and Anniek Bao contributed to this European markets summary.