(News Bulletin 247) – The Dax, the flagship index of the Frankfurt Stock Exchange has just set a new session record at 16,293.68 points on Friday.

The Frankfurt Stock Exchange hit a new record high on Friday as recession risks ease and inflation slows in Europe and the United States, giving markets the prospect of slower central bank rate hikes .

The Dax index of star stocks reached 16,293.68 points, at 2:20 p.m. Paris time, up 0.81%, before falling. The previous record dated from November 2021 to 16,290.19 points, before the invasion of Ukraine by Russia and the energy crisis, which had plunged it below 12,000 points last October.

“Fears of inflation and recession are, for a while at least, out of sight and out of mind of market participants,” said independent analyst Timo Emden.

An economy that held up better than expected

The German economy held up better than expected this winter to the energy crisis and geopolitical tensions, which had raised fears of a recession at the start of the year, after a decline of 0.5% in the last quarter of 2022.

The GDP of Europe’s largest economy finally stagnated between January and March. And after peaks reached in August, gas prices, which are particularly important for German industry, have even returned to their pre-crisis level on the short-term markets.

Inflation, which remains very high in the country, has also begun a slow decline, reaching 7.2% in April, against 8.8% at its peak in October.

This decline, which can also be observed in the United States and in most of the euro zone, allows the markets to hope for an imminent slowdown in the rise in interest rates led for several months by the central banks in the face of the rise prices.

The hope of an agreement in Congress between the US government and the Republican opposition on the debt is also pushing the hopes of the German market.

(With AFP)