Paolo Zanghieri Inflation remains the main constraint for the Federal Reserve, but the factors driving it are likely to matter more than the headline figure. Core PCE stood at 3.4 per cent in May and could remain at uncomfortable levels in the short term, although we expect it to peak shortly and fall to 3.1 per cent year-on-year in the fourth quarter, 0.1 percentage points below the Federal Open Market…
Analysed by Pedro del Pozo US employment figures have become the key benchmark for the markets. The latest figures reveal that it has not been a good result, but precisely because it is not it may be well received by investors. Job creation has come in well below expectations and, furthermore, the previous figure has been revised downwards. This may help to ease one of the main sources of tension…
Report by Bankinter Speaking at the monetary policy panel of the Central Bank Forum in Sintra (Portugal), Christine Lagarde emphasised that “the risks are now more balanced than they were two weeks ago” when the ECB decided to raise interest rates. The threat of prices spiralling out of control is lower following the agreement between the US and Iran to reopen the Strait of Hormuz, which reduces the need for…
Report by Intermoney The yen’s downward trend has continued to intensify in recent trading sessions, consolidating above 160 USDJPY – a level that had previously served as a threshold at which the Ministry of Finance would actively intervene in the market to support the yen. With the pair closing on Wednesday at around 162.22, the Japanese currency has reached its lowest levels against the US dollar in 40 years. As…
Report by Morgan Stanley Just a few days ago, Apple announced a 20 per cent price rise on some of its products due to the sharp increase in memory and storage costs, a phenomenon which, according to Shawn Kim, an analyst at Morgan Stanley, is becoming one of the clearest signs of the growing “inelasticity” of the AI-driven economy. After decades in which the cost of memory had been falling…
Andy Burnham has promised to abide by the fiscal rules set out by Minister Rachel Reeves to reassure investors and prevent a sharp rise in debt, and not to raise income tax, National Insurance contributions or VAT. He is a staunch advocate of returning public control — though not public ownership — of water, energy and the railways, and maintains a more pro-European stance than Starmer. Analysis by Editorial Team…
Reported by Julia Pastor Of the four major economies in the Eurozone, Germany will see the lowest growth in 2026 and Spain the highest, according to Deutsche Bank’s growth forecasts. 0.7% compared to 2.6%. Italy and France will both grow by 0.8%, and the Eurozone as a whole by 0.9%. Germany is the country for which the research firm has revised growth expectations downwards the most, as it is the…
Reported by Consejeros Editorial Team Based on strategic realism, not pessimistic prophecy, and with the aim of providing Spanish companies with a tool to better understand the events that are shaking up the geopolitical, economic and commercial landscape, Cesce’s Country Risk Unit has produced a new edition of its International Outlook report, the eleventh. “Our country’s business community cannot be a mere spectator in a scenario such as the current…
The new Chairman of the Federal Reserve, Kevin Warsh, appears to favour giving greater weight to the Trimmed Mean PCE at the expense of the traditional Core PCE, which has been the benchmark indicator to date. The distinction is not insignificant. Whilst the Core PCE systematically excludes food and energy, the Trimmed Mean discards components with the most extreme price fluctuations, regardless of their category. A more surgical approach, in…
By Libby Cantrill President Donald Trump is in the French Alps this week to attend the annual G7 leaders’ summit, where one of the main focal points will be the recent memorandum of understanding (MOU) between the United States and Iran. Although the details of the agreement have not yet been made public, it reflects a fragile truce – one that is politically welcome for Trump, whose approval ratings have…