According to historian Adam Tooze, we are currently potentially facing a “polycrisis”: a number of smaller to medium-sized crises in the world that have the potential to combine and reinforce each other.
The European Bank for Reconstruction and Development (EBRD) projects growth in its region will slow as a result of gas supply problems that are feeding an energy crisis. The bank says growth will slow to 2.3% in 2022 in its region and 3% in 2023.
The third decline in a row for the eurozone PMI indicates that business activity has been contracting throughout the quarter. This confirms our view that a recession could have already started.
Global inflation was generally moderating when the pandemic began, and the downward trend continued into the early months of the crisis. But surging prices since late 2020 have pushed inflation higher than in all of the last five years combined.
The European Central Bank has decided on the largest rate hike since the start of the monetary union and has given the impression that it is fully determined to do more on September 7.
While there are short-term fluctuations in interest rates caused by economic circumstances and central bank policies, there are also long-term structural trends affecting interest rates.
It is a familiar narrative, but a firmly hawkish Fed plus major exporting nations seeing their trade surpluses wiped out by higher energy costs continue to drive the dollar higher. And we doubt an extra 25bp of ECB tightening this autumn will help.
The list of arguments why the German economy is sliding into recession is getting ever longer. The question isn't about whether there'll be a recession but rather how severe and how long it will be.
While wage growth remains strong, there are signs that the unemployment rate is rising. This weakening could be because companies are slowly starting to adapt to their ever-increasing costs by downsizing their workforce.
Supply shocks continue to plague the eurozone economy, causing inflation to show few signs of abating in the short run.
In the context of severely heightened security concerns across Emerging Europe, the 2024 US presidential election is already seen as a significant risk for the region.
The tightening cycle by central banks in Emerging Europe is coming to an end as regulators across the region start to get inflationary pressures under control, Capital Economics said in a note on August 8.
Demographics and GDP Many believe that demographics is at most remotely related to economics. If you are one of these, perhaps by the time you finish reading this article, you will be convinced how fundamentally demographics underpins economics.
Despite huge state support (often funded by the EU) the market value of the Hungarian startup ecosystem is estimated at only 0.9% of GDP.
In my opinion, the macro environment is riskier than before the Dotcom Bubble and before the Great Financial Bubble. Why? A nasty cocktail of factors which may reinforce each other: