Euro area borrowing costs eased in June

Borrowing costs for euro area corporates fell in June, according to the latest data on bank interest rate statistics published by the European Central Bank. The composite cost-of-borrowing indicator, which tracks interest rates on all loans to corporations, decreased during the month. For new loans of over €1m with a floating rate and an initial rate fixation period of up to three months, rates remained broadly unchanged at 3.29%. 

Loans of the same size with an initial rate fixation period of over three months and up to one year declined by seven basis points to 3.41%, while those with a fixation period of over ten years fell by 17 basis points to 3.54%. Smaller loans of up to €250,000 with a floating rate and an initial rate fixation period of up to three months recorded a seven basis point decrease to 3.71%.

Deposit rates also moved lower in June. The rate on deposits from corporations with an agreed maturity of up to one year fell by 12 basis points to 1.94%, while the rate on overnight deposits declined by five basis points to 0.53%.

For sole proprietors and unincorporated partnerships, the interest rate on new loans with a floating rate and an initial rate fixation period of up to one year decreased by 14 basis points to 3.97%.

These figures suggest a modest easing in financing conditions for businesses, despite ongoing uncertainty over broader monetary policy trends.

 

UK business confidence hits highest level in a decade

Business confidence in the UK rose in July to its highest level since 2015, according to the latest Lloyds Business Barometer. The index increased by one point to 52%, marking a third consecutive monthly gain and signalling resilient optimism despite cost pressures and trade concerns earlier in the year.

Stronger trading prospects and improved economic sentiment were behind the rise, with economic optimism reaching an 11-month high of 47%. The improvement follows a recovery from April’s dip, when concerns over trade conditions briefly dampened expectations.

Hiring intentions were a major driver of confidence. Sixty percent of businesses expect to increase headcount over the next 12 months, compared to 14% planning to reduce staff. This pushed the net balance for employment to 46%, its highest level in ten years. Wage growth expectations eased slightly, with 34% of firms forecasting average pay rises of 3% or more, the first decline in three months.

Price expectations remained high but stable, with 61% of firms expecting to raise prices in the coming year. Although unchanged from June’s elevated levels, this remains above the long-term average of 45%.

The services sector was the standout performer, with confidence rising 11 points to 61%, offsetting weaker sentiment in retail, manufacturing and construction. Regional performance varied, with Wales remaining the most optimistic area and strong improvements in the West Midlands and North East. Confidence fell in London, down two points, although the capital remains the third most optimistic region overall.

The data suggests momentum in the UK economy is increasingly being driven by services and hiring, even as wage and price pressures show early signs of easing.

“This continued upward trend reflects a growing sense of cautious optimism across the UK economy, underpinned by both improved trading prospects and broader economic sentiment,” commented Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking. “Despite ongoing cost pressures, firms are positioning for growth, particularly in services where hiring and investment plans are accelerating. Overall business confidence remains buoyant, with firms well placed to take advantage of opportunities such as new markets, adopting new technology and workforce expansion amid evolving market conditions.”

 

Global commodity price and supply pressures remain subdued

Global commodity price and supply pressures were muted at the start of the third quarter, according to the latest Global PMI Commodity Price & Supply Indicators compiled by S&P Global Market Intelligence. The Global Price Pressures Index remained unchanged at 0.5 in July, indicating that reports of higher commodity prices were around half the historical average.

Five of the 26 monitored commodities saw falling prices, although most decreases were marginal. Polyethylene, PVC and stainless steel recorded the sharpest declines, while six commodities, led by electrical items and semiconductors, saw above-average price increases. Transport costs also rose, marking their highest level in five months.

Supply shortages remained limited, with the Global Supply Shortages Index edging down to 0.5 from 0.6 in June, the softest level in four months. Only transport, stainless steel and aluminium experienced supply shortfalls above their long-term averages. Reports of transport shortages were particularly widespread, reaching their highest point since April 2023.

Commenting on the data, Usamah Bhatti, Economist at S&P Global Market Intelligence, elaborated: “Commodity price pressures faced by global manufacturing firms remained soft during July, with reports of higher prices remaining around half the normal level. In fact, there were slight reductions in price for five monitored commodities, led by Polyethylene, PVC and Stainless Steel. Of the commodities which saw above-average reports of higher prices, the strongest increase was seen for Electrical Items, followed by Semiconductors. Concurrently, Transport prices rose to the greatest extent since February.

“Pressure on supply chains was also subdued as the second half of 2025 began, with reports of supplier shortfalls around half the normal level. Transport recorded by far the most widespread shortages in July at over seven times the usual level, marking the greatest shortfall of global freight capacity since April 2023.”

The data highlights stable price trends and easing supply pressures across most commodities, though transport costs and capacity constraints remain key risks heading into the second half of 2025.

 

Indonesian CFOs focus on capital efficiency, AI and ESG to navigate global volatility

Capital optimisation, artificial intelligence (AI) and environmental, social and governance (ESG) performance are expected to be top business priorities for Indonesian companies over the next five years, according to research from DBS Bank. The findings, published in the bank’s 'New Realities, New Possibilities' report, are based on surveys of more than 800 finance leaders, including chief financial officers and corporate treasurers, across seven sectors and 14 markets.

The research highlights the pressures created by geopolitical tensions, inflation-driven volatility and supply chain disruption, which were cited as challenges to stability by 58%, 57% and 55% of respondents respectively. However, emerging technologies such as generative AI and blockchain (83%) and the rise of sustainability agendas (76%) were viewed as positive drivers of innovation and efficiency.

In Indonesia, 80% of finance leaders placed capital cost optimisation as their highest priority, reflecting pressures from trade frictions, currency weakness and inflation. This focus is closely linked to liquidity and foreign exchange management, which climbed from seventh to second place in priority rankings following April’s US tariff announcements.

ESG performance has also emerged as a key strategic agenda, with 78% of Indonesian respondents citing it as critical to meeting regulatory requirements and securing funding. Meanwhile, 76% rated treasury transformation and process automation as vital for operational efficiency and strategic agility.

DBS noted the introduction of a Strategic Effectiveness Indicator (SEI) to measure the success of corporate priorities. ESG performance scored highest among Indonesian respondents at 82%, followed by capital cost optimisation (78%) and treasury enhancements (76%).

Anthonius Sehonamin, head of institutional banking group at PT Bank DBS Indonesia, said the research reflected that “CFOs now face broader challenges - beyond tech and data - to include liquidity and FX amidst global volatility.” 

With Indonesia positioning itself as a competitive manufacturing hub and expanding special economic zones, DBS expects these priorities to define treasury and finance strategies for years to come, particularly as companies seek to build resilience against global economic headwinds.

 

Spain’s growth outlook lifted as high value-added services drive expansion

Spain has emerged as the fastest-growing major economy in Europe, supported by a shift toward high value-added services that has accelerated since the Covid pandemic, according to Goldman Sachs Research. The bank has raised its forecasts for Spanish GDP growth, expecting the economy to expand by 1.9% in 2026 and 1.7% in 2027, up from previous projections of 1.5% and 1.6%. These upgrades also lift the euro area growth forecast for next year by 0.1 percentage point to 1.2%.

While southern Europe’s services economy has traditionally been dominated by tourism, the sector’s composition has changed, with finance, real estate, information and communications technology, and professional services playing an increasingly important role. Spain has outperformed even this regional shift, with the share of high value-added services in GDP now 3 percentage points higher than before the pandemic and one percentage point above the rest of the euro area.

“The shift toward high value-added services is the least appreciated structural change of the Spanish economy in our conversations with investors,” said Filippo Taddei, Goldman Sachs Research’s senior economist for southern Europe and European policy.

Goldman Sachs expects Spain’s performance to remain a key driver of euro area growth in the coming years, reflecting a broader rebalancing in the region’s services sector.

 

UK firms embrace digital banking but trust traditional providers

UK business owners are increasingly turning to online-only banks, with convenience and competitive pricing driving adoption, according to new research by NerdWallet UK. The survey of 500 business leaders shows 70% would now consider opening a business bank account with no physical branches, up from 66% in 2024. The shift reflects growing confidence in digital-first providers such as Monzo, Revolut, ANNA Money and Tide. Almost a third (31%) of respondents now view online-only banks as equally reputable as high street institutions like Lloyds, Barclays and HSBC, compared with just 8% last year. Convenience remains the top driver, cited by 43% of respondents, nearly double the proportion recorded in 2024. Pricing is also a factor, with one in three business leaders saying digital banks offer structures better suited to their needs.

Despite these gains, traditional banks continue to hold an edge on trust, with 30% of respondents saying they rely more on established institutions, versus 21% who favour digital providers. Almost half (45%) trust both equally, suggesting the gap may narrow as more businesses adopt digital-first solutions.

The survey also highlights frustrations with traditional banks. Respondents cited high or unclear fees (31%), slow adoption of modern digital tools (27%), and poor mobile and online banking services (25%) as key drawbacks. A quarter of businesses reported losing trust in traditional banks due to service issues or long wait times, while 24% said support outside regular business hours was lacking.

Interestingly, while fewer than one in three (29%) prioritised access to a physical branch, more than a third (35%) still valued in-person advice. This suggests digital banking’s appeal lies in convenience rather than a desire to eliminate human interaction entirely.

NerdWallet notes that challenger banks have successfully cross-sold business banking products to personal account holders, with 36% of respondents choosing the same provider for both. The findings suggest a competitive landscape where digital banks are steadily improving their reputation and user experience, while traditional providers risk losing ground if they fail to adapt to evolving customer expectations.

 

K-SURE and Trafigura sign $200m financing deal for Korean shipping

The Korea Trade Insurance Corporation (K-SURE) and commodities trader Trafigura have signed a $200m mid- to long-term financing agreement to support Korean shipping companies. The agreement is the first of its kind in which an export credit agency (ECA) has provided financial backing based on time charter agreements rather than traditional capital goods exports. The move is intended to expand Korea’s shipping service exports and strengthen the competitiveness of mid-sized maritime firms.

Funding provided by K-SURE will help cover time charter fees paid by Trafigura to Korean shipping companies for its global freight operations. Trafigura, which charters vessels globally, plans to expand its chartering activity with Korean partners over the coming years.

For Korean shipping firms, the facility is expected to enhance operational capabilities and strengthen their negotiating position in the global freight market. For K-SURE, it represents a significant expansion of its export credit programmes into service-based sectors, moving beyond its historical focus on capital goods.

The transaction also marks Trafigura’s first ECA-backed financing unrelated to commodity trading volumes and its inaugural collaboration with K-SURE. Crédit Agricole Corporate and Investment Bank acted as coordinating and structuring bank for the facility, with Barclays Bank and Oversea-Chinese Banking Corporation also participating.

 

Hong Kong launches stablecoin licensing regime

The Hong Kong Monetary Authority (HKMA) has brought its regulatory regime for stablecoin issuers into effect, following the publication of supporting guidelines and explanatory notes. The new framework introduces licensing requirements for all stablecoin issuers operating in Hong Kong. It is supported by the Guideline on Supervision of Licensed Stablecoin Issuers, the Guideline on Anti-Money Laundering and Counter-Financing of Terrorism (for Licensed Stablecoin Issuers), and explanatory notes on licensing and transitional arrangements. These documents were formally published as the regime came into force on 1 August 2025.

The HKMA has invited interested parties to contact the regulator by 31 August if they intend to apply for a licence and wish to discuss regulatory expectations. Applicants considered ready for early assessment were encouraged to submit a full application by 30 September.

The authority emphasised that licensing is an ongoing process and reminded market participants not to make claims that could be misinterpreted or create unrealistic expectations. Under the Stablecoins Ordinance, it is an offence to falsely claim to be licensed or in the process of applying.

As of the regime’s launch, no licences had yet been issued. The HKMA will maintain a public register of licensed stablecoin issuers on its website and has warned the public to treat any unlicensed stablecoins as a risk.

 

Mastercard expands virtual card automation for suppliers

Mastercard has expanded its B2B payment capabilities with the global rollout of Mastercard Receivables Manager and the launch of Commercial Direct Payments, aimed at improving supplier reconciliation and automating virtual card payments.

Receivables Manager, which automates accounts receivable processes, is now available globally and supports features such as multi-language functionality and secure card-on-file to better handle digital commerce transactions. The solution is already being used by acquiring partners, including Elavon and Run Payments in the US, to address manual processing and reconciliation challenges. In Bahrain, EazyPay has adopted the technology to transform accounts receivable workflows for local businesses.

The newly introduced Commercial Direct Payments solution provides straight-through processing for virtual card transactions, enabling automatic settlement with a supplier’s acquirer and seamless integration of payment data into accounts receivable systems. By eliminating manual steps, suppliers benefit from faster reconciliation and reduced administrative effort, while buyers gain flexible options to pay with physical or virtual cards.

Mastercard said the solutions address growing demand for digital processes, citing survey data showing 93% of B2B suppliers consider digitising payments a top priority, though two-thirds still report challenges meeting buyer payment expectations.

Commercial Direct Payments is a card network-agnostic solution initially launched in the US, with telecoms technology firm Sakon as its first customer. The combined enhancements aim to improve efficiency, strengthen buyer-supplier relationships and support the wider digitalisation of B2B payments.

 

Engie and Mobilize adopt Finastra risk solution

Engie and Mobilize Financial Services have adopted Finastra’s KTP treasury management solution, incorporating the Lozenge Prism module for complex valuations and risk analytics. The integrated technology enables corporates to speed up month-end closing processes, perform advanced risk calculations and improve regulatory compliance.

Treasurers often face challenges in month-end reporting, including fragmented data sources and time-consuming manual processes, which can delay decision-making and increase operational risk. Finastra’s Prism module consolidates these processes, allowing for faster, automated Mark-to-Market (MTM) calculations and daily margin calls.

For Engie, the solution has replaced multiple disparate tools previously used to calculate MTM across a diverse set of financial assets, reducing processing times and improving data reliability. Following its successful deployment, the company has extended the tool’s use to daily collateral management and bank pricing benchmarks, with plans to roll it out globally.

Mobilize Financial Services, which operates as a regulated banking entity within the European market, has leveraged the integrated system to strengthen compliance with regulatory requirements such as Interest Rate Risk in the Banking Book (IRRBB) and Credit Spread Risk in the Banking Book (CSRBB). The platform’s risk analytics capabilities enable detailed scenario modelling and continuous monitoring of balance sheet sensitivities, supporting regulatory submissions and internal risk management.

 

TreasurySpring and Hazeltree integrate fixed-term investment access

TreasurySpring has partnered with Hazeltree to integrate its fixed-term cash investment marketplace directly into Hazeltree’s treasury and liquidity management platform for alternative asset managers. The integration gives Hazeltree clients access to more than 950 fixed-term investment products from over 90 issuers and across eight currencies. These products include collateralised repos with international banks, as well as government and corporate securities, enabling institutional investors to deploy surplus cash across a range of secure short-term options.

By embedding TreasurySpring’s marketplace within existing treasury workflows, Hazeltree clients can act on investment opportunities without the need for additional infrastructure or operational resources. The combined platform also allows clients to align cashflow forecasting with direct access to fixed-term investment opportunities, creating an end-to-end solution for liquidity management.

The partnership reflects growing demand from hedge funds and private market participants for tools that support agile, secure and efficient cash management. TreasurySpring’s infrastructure enables diversification of idle cash holdings, while Hazeltree’s platform provides treasury intelligence and workflow automation to optimise decision-making.

 

Boost and FIS partner on automated B2B virtual card payments

Boost Payment Solutions has partnered with financial technology provider FIS to enhance automation and efficiency in virtual card payments. The collaboration integrates Boost’s patented straight-through processing technology, Boost Intercept, into FIS’s Automated Finance suite. This gives users of FIS’s GETPAID and BillerIQ platforms an automated way to accept virtual card payments, eliminating the manual workflows and email-based processes that often slow accounts receivable (AR) teams.

Through the integration, AR teams can access lower-cost acceptance options, enhanced remittance reporting, reduced fraud risk and streamlined reconciliation processes. The partnership also strengthens FIS’s accounts payable (AP) offering by incorporating Boost’s supplier enablement services, supplier network and STP acquiring technology.

According to the companies, virtual card adoption continues to rise as payables departments look to reduce fraud risk and move away from cheque-based payments. At the same time, they note, receivables departments often face challenges when processing virtual card payments. The Boost–FIS integration is intended to address these issues, offering a more automated and scalable solution for B2B payments.

 

PNC Bank integrates with Oracle Fusion Cloud ERP for embedded banking

PNC Bank has integrated its embedded banking platform, PINACLE Connect, with Oracle Fusion Cloud Enterprise Resource Planning (ERP). The connection is designed to give corporate and commercial banking clients direct access to treasury services from within Oracle Cloud ERP, streamlining cash and payment workflows.

The integration uses Oracle’s B2B offering to deliver turnkey connectivity, enabling clients to access balance and transaction data, initiate and approve payments, and reconcile accounts without leaving their ERP environment. This is intended to reduce reliance on multiple platforms, automate manual processes and improve financial reporting accuracy.

PNC says the embedded approach will help clients manage cash positions more effectively and reduce time spent establishing bank connectivity. The move builds on PNC’s existing strategy of integrating its services with leading ERP and treasury management systems to provide consolidated access to financial data.

Oracle notes that embedding banking services directly into ERP workflows can improve transaction speed, reduce errors and enhance productivity by eliminating manual navigation between systems.