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There were mixed signals about the health of the eurozone economy today, new data showed. better than expected growthbut higher than expected inflation.
A “fast” estimate for the second quarter showed that gross domestic product rose by 0.7% compared to 0.5% in the previous three months, driven by the strong performance of the revived tourism sector, especially in Spain (with growth of 1.1% ). ) and Italy (1%).
Economists also welcomed the strengthening Spanish labor marketwhere the unemployment rate has reached its lowest level since 2008. The increase in the number of permanent jobs follows recent reforms aimed at reducing the high share of the workforce on temporary contracts.
France reported higher-than-expected growth of 0.5% thanks to strong exports and momentum from tourismconstrained by fears that domestic demand will remain stagnant.
Growth in Germany was also flat as household and government spending helped support economic activity despite the higher cost of oil and gas imports. However, fears remain that a further reduction in gas supplies from Russia could lead to a recession in the country.
Meanwhile, inflation in the euro area accelerated from 8.6% in June to 8.9% in July thanks to a 40% jump in energy prices and a 10% increase in food prices. The exclusion of these volatile items led to an increase of 4%, still double the ECB’s target of 2%.
In Germany, the eurozone’s largest economy, inflation rose to 8.5% in July from 8.2% in June, helped by a 14.8% jump in food prices.
War in Ukraine – and gas crisis in particular, means that the outlook for the eurozone in the second half of the year is bleak and looks even bleaker given the turmoil in Italian politics. According to the European Commission, consumer confidence is already at its lowest level ever.
Today’s inflation data raises the possibility that European Central Bankwhich last week raised interest rates for the first time in more than a decade, will announce another 50 basis point increase in September.
Compare price increases by country with ours global inflation tracker
Oil prices jump by $4 a barrel as chances of more OPEC+ supply shrink (Reuters)
US consumer sentiment remains close to record low
RMT union members at Arriva Rail London vote to strike (Pennsylvania)
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What you need to know: economics
New inflation and wage data offered a little relief for US Federal Reserve thereafter higher interest rates by 0.75 points for the second consecutive month on Wednesday. The core personal consumption spending index, the Fed’s preferred measure of inflation, rose 1% in June, pushing the annual rate up to 6.8% from 6.3%. The exclusion of volatile items like food and energy saw the “core” PCE rise 4.8%, more than double the Fed’s target.
This follows from yesterday’s news that The US economy contracted in the second quarter in a row at the level of 0.9% year on year. US Economics Editor Colby Smith answers an important question: US in recession? (TLDR: It depends.)
New for the UK and Europe
Customer credit in the United Kingdom doubled last monthaccording to the Bank of England, as people turned to credit cards and other forms of debt to cope with the rising cost of living.
Future UK economic policy continues to dominate the fight for the next prime minister. Favorite bookmakers Liz Truss rejected the idea of further contingency taxes to energy companies, even if Centricthe owner of British Gas and the country’s largest energy retailer, restored its dividend and reported that operating profit had increased. more than five times during the energy crisis.
Poor performance recognized as one of the main problems holding back the UK. Columnist Tim Harford went to Legoland for inspirationbut regrets that his strategy of focusing on the good things and “shoveling the rest down the memory hole” now seems to be the centerpiece of government strategy.
President of the U.S.A Joe Biden is set to two significant legislative profit before the midterm elections in November. The $280 billion package provides subsidies for the semiconductor industry, and a massive tax, climate and social spending bill looks set to pass.
Argentina appointed its third official take responsibility for the troubled economy of the country in less than a month. Sergio Massa, the leader of the Peronists in Congress, will be in charge of the ministry responsible for economic, industrial and agricultural policy.
Companies and investors discard most of Latin Americastock markets, writes LatAm editor Michael Stott, due to a decade of slow growth, a weak currency and bad headlines. At the end of 2012, the region accounted for only 6.4% of the MSCI Global Emerging Markets Equity Index—less than a third of its weight in 2010.
Chinacentral bank proposes ambitious attempt to revive indebted country real estate sector with $148 billion for real estate projects. The downturn in the real estate market played a big role in reducing economic growth to just 0.4% in the second quarter.
What you need to know: business
Positive results from big technology put stock markets are gearing up for their best month yet from November 2020. The latest information comes from Amazon, which reported revenues higher than expected and improved forecast, as well as from Apple, which recorded revenue growth despite supply chain challenges in China. However, Intel reported unexpected drop in income and lowered its forecasts, which led to a drop in its shares.
Energy is another standout sector as companies reap the dividends from skyrocketing prices. ExxonMobil and Chevron both companies reported record quarterly profits, while Shell broke the record record earnings for the second quarter in a row and announced a $6 billion share buyback.
British Airways parent YAG announced his first profit since the start of the pandemic, despite continued industry disruptions. IN THE USA, Southwest recorded record profit as demand soared but warned of problems ahead. jetblue agree with buy the spirit of an opponent $7.6 billion to create the fifth largest U.S. airline, though the deal could face regulatory challenges.
automaker the results revealed strong demand at the top of the market. Renault raised its forecasts by focusing on more expensive models, while Bentley reported an increase in profits thanks to sales of luxury cars. Star – maker of Jeep, Alfa Romeo, Peugeot and Fiat brands – was able to get rid of supply problems, raise prices and report a third increase in net profit.
Less good news for the UK car industry as a global chip shortage means it won’t be back to making 1m cars a year until minimum 2025 two years later than expected. Losses increased by Aston Martin due to bottlenecks in the supply chain.
Meanwhile, another sector benefiting from the demand for luxury goods is beverage marketwhere Diageo profits from rapidly growing sales of “super premium plus” spirits such as Don Julio tequila and Bulleit bourbon.
Colgate became the latest major consumer group to announce rising prices as it passed on the rising costs to the customers. Nestle said yesterday price increase by 6.5% allowed to increase the sales forecast for the year. Hershey seems to have gotten away with it too price increase.
last wave COVID-19 cases in England, Wales and Scotland operated by the BA.5 variant appear to be retreating, according to official data. Approximately one in 20 people were infected in the week leading up to July 20, compared to one in 17 the previous week. Data are collected from private households and exclude infections in hospitals or nursing homes.
There has been a sharp increase obesity in many countries during a pandemic due to reasons such as disruption of the daily routine and increased stress. Chief data reporter John Burn-Murdoch says it’s time to shift focus from individual responsibility to how we live and work.
New report assesses economic impact lungs covid in the United Kingdom. On average, patients lost about £1100 per month in profits, which together adds up to £1.5bn across the economy. Official figures for May showed that about 2 million people had persistent symptoms of Covid.
Corporate results this week provided some guidance on the development of vaccines and treatments for Covid. pfizer Paxlovid the antiviral drug is one of the fastest-selling drugs in history, with annual sales projected to hit $22 billion this year. However, there may be a surplus of 70 million doses by the end of the year as patient absorption slows down.
Strong sales Evus hero Covid-19 antibody treatment, which helps protect people who do not respond to vaccines, has gained momentum AstraZeneca in the first half. Sales reached $445 million, which is almost equal to the revenue from the vaccine, developed by the company together with the University of Oxford. However, Evushheld’s sales are expected to increase, in contrast to jab sales.
Covid cases and vaccinations
Total global cases: 568.7 million
General doses: 12.3 billion
Get the latest world picture with our vaccine tracker
Commonwealth Games, which kicked off this morning in the UK’s second city of Birmingham, is seen as a huge advance for athletes with disabilities. Unlike other major competitions, the parasport program is fully integrated and all medals contribute to the total for each country. Here is the BBC tips on what to see.