Economy news: The stories to read this week

European Union lawmakers look set to back tougher safeguards for transfers of bitcoin and other cryptocurrencies.

At the same time, the UK has laid out plans to become a “global hub” for the crypto industry. This includes new regulations for stablecoins – cryptocurrencies where the value is pegged to a currency such as the dollar – and a host of other measures to court digital asset companies.

The value of global merger and acquisition activity fell by 29% in the first quarter of this year, as volatility fuelled by Russia's invasion of Ukraine put the brakes on last year's high pace for deals.

Consumer prices in the Eurozone rose by a record 7.5% in March compared with a year ago. Higher energy and food prices were a major factor.

German inflation has also jumped, hitting its highest since the country's reunification in 1990. Prices rose by 7.3% in March compared with a year earlier.

It comes as the war in Ukraine dampens consumer sentiment in Germany, according to a new survey.

The World Bank has warned that the war in Ukraine could mean lower growth and increased poverty in East Asia and the Pacific.

China has issued a new draft law on financial stability, aimed at strengthening safety nets to prevent systemic financial risks.

Sanctioned Russian lender VTB has made interest payments in roubles to holders of its domestic subordinated bonds denominated in dollars and euros, Russia's National Settlement Depository said on Tuesday. The country's ability to continue servicing debt in foreign currencies is in focus as the government, which has so far avoided a default, faces issues paying holders of its sovereign debt.

VTB's payment came a day after the United States stopped Russia paying holders of its sovereign debt more than $600 million from frozen reserves held at US banks. The US said Moscow had to choose between draining its dollar reserves at home and default. Find out more about debt default here.

Sweden's economy shrank for the second straight month in February. “The surprisingly low reading appears to follow mostly from weak services production and construction, but household consumption disappointed too,” an analyst at bank Svenska Handelsbanken wrote in a note to clients, reports Bloomberg.

The US Federal Reserve has set out a plan to shrink its balance sheet by over $1 trillion a year.

Sri Lanka's currency, the rupee, has plunged to a record low, amid an economic and political crisis. Sri Lanka faces a foreign exchange crisis, reports the Financial Times, with pending debt payments, widespread protests over food and power shortages, as well as high inflation.

Green financing has grown over 100 times globally in the past decade, a new study from financial industry group TheCityUK and French bank BNP Paribas has shown.

Green financing is aimed at environmentally friendly projects. The research showed that global borrowing by issuing green bonds and loans – and equity funding through initial public offerings targeting green projects – swelled to $540.6 billion in 2021 from $5.2 billion in 2012.

Green bonds accounted for 93.1% of total green finance globally between 2012 and 2021. In 2021, global green bond issuance stood at $511.5 billion, compared with $2.3 billion in 2012.

You can read more about green bonds here.

Global sovereign borrowing in 2022 is set to reach $10.4 trillion. This is nearly a third above the average before the COVID-19 pandemic, according to a report from S&P Global Ratings.

Despite an economic recovery, borrowing will stay elevated because of high debt rollover requirements and the war in Ukraine, the ratings agency said.

While 137 countries will borrow an equivalent of $10.4 trillion this year – an estimated 30% lower than 2020 – the overall figure is a third higher than average borrowing between 2016 and 2019, S&P said.

"Tightening monetary conditions will push up government funding costs," S&P analysts said.

"This will pose additional difficulties to sovereigns that have been unable to restart growth, reduce reliance on foreign currency financing, and where interest bills are already critically high on average."

New research looks at the labour market recovery from the COVID-19 pandemic, job creation and the type of employment people are looking for.

The role of trust in economic policy? This column explores the relationship.

IMF research looks at how rapidly rising shipping costs are driving price rises globally.