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Eurozone health check: growth is up but so is inflation

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There were mixed signals about the health of the Eurozone economy today as new data showed Better growth than expectedbut higher than expected inflation.

The Bezeq 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 strong performance from a renewed tourism sector, especially in Spain (with growth of 1.1%) and Italy (1 percent). .

Economists also welcomed the strengthening of Spain’s labor marketThere the unemployment rate reached its lowest level since 2008. An increase in permanent jobs followed recent reforms, which aimed to cut the high proportion of the workforce on temporary contracts.

France reported higher than forecast growth of 0.5 percent, thanks to Strong exports and boost from tourismModerated by concerns that domestic demand remains constant.

German growth was also flat as household and government spending helped spur economic activity despite the higher cost of oil and gas imports. However, there remain concerns that further suppression of the gas supply from Russia could tip the country into recession.

Inflation in the Eurozone meanwhile rose from 8.6% in June to 8.9% in July, thanks to a 40% jump in energy prices and a 10% increase in food costs. Stripping out these volatile items left an increase of 4 percent – still double the ECB’s target rate of 2 percent.

In Germany, the largest economy in the Eurozone, inflation rose to 8.5 percent in July from 8.2 percent in June, driven by a 14.8 percent jump in food prices.

The 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 Italian politics. Consumer confidence is already at an all-time low, according to data from the European Commission.

Today’s inflation figures increase the likelihood that European Central Bankwhich last week raised interest rates for the first time in more than a decade, will announce another increase of 50 basis points in September.

Compare cost prices country by country with our Tracks global inflation

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Need to know: the economy

New Inflation and wage data Offered little relief for The US Federal Reserve After this Raise the interest rate by 0.75 points, the second month in a row on Wednesday. The core measure of personal consumption expenditures, the Fed’s preferred measure of inflation, rose 1% in June, lifting the annual rate to 6.8% from 6.3%. Stripping out volatile items like food and energy left the “core” PEC up 4.8%, still more than double the Fed’s target.

This follows yesterday’s news that The US economy contracted in the second quarter continuously by 0.9 percent on an annual basis. The American economics editor, Colby Smith, faces the big question: Is the US in a recession? (TLDR: It depends.)

Latest for UK and Europe

Consumer loans in the UK 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.

the future of Britain’s economic policy continues to control the shells for the next prime minister. Hibook favorite Liz Truss dismissed the idea of ​​more Windfall taxes About energy companies, even like CentricaThe owner of British Gas and the country’s biggest energy retailer has reinstated its dividend and reported that operating profits increased More than five times During the energy crisis.

Poor productivity Recognized as one of the main problems holding the UK back. Columnist Tim Harford Went to Legoland to get inspiredBut Konna bemoaned the fact that her strategy of focusing on the good stuff and “pushing the rest down the memory hole” now appears to be the central part of the government’s strategy.

the last in the world

President of the United States Joe Biden determined to be two significant The legislator wins In preparation for the mid-term elections in November. A $280 billion package authorizes subsidies for the semiconductor industry, while a sweeping tax, climate and social spending bill looks set to pass.

Argentina Appointed her third official to to take responsibility for the country’s troubled economy in less than a month. Sergio Massa, a Peronist leader in Congress, will be in charge of an office overseeing economic, manufacturing and agricultural policy.

Companies and investors are Abandon Rob Latin AmericaThe stock markets of, writes LatAm editor Michael Stott, because of a decade of slow growth, weak currencies and bad headlines. At the end of 2012, the region accounted for just 6.4% of MSCI’s emerging market global stock index – less than a third of its weight in 2010.

porcelainThe country’s central bank has proposed an ambitious attempt to revive the debt-ridden country the property sector with a bailout of $148 billion for real estate projects. The decline in assets played a large role in reducing economic growth to just 0.4% in the second quarter.

Need to know: Business

Positive results from Big Tech to put Stock markets are on track for their best month yet Since November 2020. The latest comes from Amazon, which reported Revenues are better than expected and an improved forecast, and Apple, which recorded Revenue growth despite supply chain issues in china However, Intel reported on An unexpected drop in revenue and reduced its forecasts, sending its shares plummeting.

energy is the other prominent sector as companies reap the dividend of rising prices. Exxon Mobil and Chevron Both reported record quarterly profits, while Shell broke it Record profit in the second quarter consecutively and announced a $6 billion share buyback.

Parent of British Airways IAG reported it first profit Since the pandemic hit, despite the ongoing disruption in the industry. in the United States, South-West recorded record profits as demand rose but warned of trouble ahead. JetBlue agree to Buy competitor Spirit for $7.6 billion to create the fifth-largest U.S. airline, although the deal may face regulatory challenges.

car manufacturer The results highlighted strong demand at the top end of the market. Renault upgraded its forecasts as it focuses on more expensive models, while Bentley reported an increase in profits thanks to the sale of its luxury vehicles. Stellentis – the maker of the Jeep, Alfa Romeo, Peugeot and Fiat brands – managed to shrug off supply problems to raise pricing and report a third rise in net profit.

There was less good news for UK car manufacturing, as the global chip shortage means it won’t return to producing a million vehicles a year until At least 2025 – Two years later than expected. Losses soared in Aston Martin Because of bottlenecks in the supply chain.

Meanwhile, another sector benefiting from the demand for luxury items is the liquor marketwhere Diageo Profits from booming sales of “super premium plus” liquor brands such as Don Julio Tequila and Bullitt Bourbon.

Colgate became the latest major consumer group to announce price increases As he passed on increasing costs to customers. snuggle up said yesterday Price increase by 6.5%. Allow her to raise her sales forecast for the year. Hershey Looks like he’s out of it too Raising prices.

Science summarizes above

The last wave of cases of COVID In England, Wales and Scotland, powered by the BA.5 variant, they appear to be in retreat, according to Official data. About one in 20 people were infected in the week to July 20, compared to one in 17 the previous week. The data is collected from private households and does not include infections in hospitals or nursing homes.

There was a sharp increase in obesity In many countries during the epidemic due to reasons such as routine disruptions and increased stress. Chief data reporter John Burne-Murdoch says it’s time to shift the focus from individual responsibility to How we live and work.

Chart showing that stress, poverty and perceived lack of control over one's life and work can increase the likelihood of weight gain

A new report has put a price on the economic impact of long covid in the UK. On average, sufferers lose approx £1,100 per month in profits, adding up to £1.5 billion in aggregate across the economy. Official figures for May showed that around 2 million people had persistent symptoms of Covid.

Corporate results this week offered some pointers on developing vaccines and treatments against Covid. of Pfizer Paxlovid An antiviral drug is one of the best-selling drugs in history, with annual sales this year expected to reach $22 billion. However, there could be a surplus of 70 million rations by the end of the year Patient uptake is slowed.

strong sales of Oscheld Covid-19 antibody therapy, which helps protect people who do not respond to vaccines, has been given a boost AstraZeneca in the first half of the year. Sales reached $445 million, almost equal to the revenue from the company’s vaccine developed with the University of Oxford. However, Evusheld sales are expected to increase, unlike jab sales.

Covid cases and vaccinations

Total global cases: 568.7 minutes

Total doses given: 12.3 billion

Get the latest worldwide image with our Vaccine tracker

Some good news

God Commonwealth Games, launched in the UK’s second city of Birmingham this morning, is billed as a huge advance for disabled athletes. Unlike other major events, the para-sport program is fully integrated, with all medals contributing to each country’s total. Here’s the BBC’s Tips on what to expect.

Hannah Cockroth
British Paralympic champion Hannah Cockcroft, seen here in the 2013 race, makes her Commonwealth Games debut in the T33/34 100m © Suzanne Plunkett/Reuters

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Eurozone health check: growth is up but so is inflation Source link Eurozone health check: growth is up but so is inflation

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