Economic Newsletter July
Economy stays in good shape, despite risks
Despite all the talk about geopolitical risks, the outlook for the global economy continues to be positive: the US is very strong, the European slowdown seen during the first months of the year has been temporary (see, for example, the May employment data) and most emerging economies have solid foundations. Even though spare capacity is being eliminated somewhat quickly and upward pressures on prices and wages are becoming increasingly evident, markets remain convinced that we live in a world with very little inflation, where interest rates are set to remain low permanently.