Why You Need to Know These 5 Global Economic News

Economic Highlights of the Week

Another week in the financial world has passed, shedding light on at least 5 crucial global news that investors should be aware of to navigate the international markets.

1.
US Inflation Decreases, Debt Alert

The core Consumer Price Index in the US, which excludes food and energy costs, has risen by 0.1% since May, marking the smallest increase in three years.
The overall measure has dropped for the first time since the beginning of the pandemic, pulled down by cheaper gasoline prices.

The data on US inflation has raised expectations for a potential interest rate cut.
Meanwhile, investors see one of the best generational opportunities to purchase distressed US real estate assets, as the sector’s collapse continues to disrupt the market.

Almost $1 trillion in commercial real estate debt is set to mature in the US this year, according to the Mortgage Bankers Association, and the rise in defaults due to borrowers failing to repay will create more options for buyers eyeing distressed assets.

2.
France’s Puzzle

Emmanuel Macron’s efforts to defuse the political crisis he triggered through early parliamentary elections have met a sharp backlash, underlining the decline in the French president’s authority and revealing deep divisions.

The political shock in France has forced bond investors to confront the reality that the nation’s fiscal deficit is a problem for the present, not just the years to come.
The country has long benefited from investors overlooking the threat posed by its weak public finances, given its central position within the euro area.
That calm is now at risk according to investors.

3.
China, Trade Surplus Record

China’s trade surplus hit a record $99 billion in June, driven by a surge in exports and an unexpected drop in imports, raising the risk that the US and Europe will intensify efforts to shield their markets from Beijing.

4.
Taiwan, AI Boom

The Artificial Intelligence boom is fueling a surge in Taiwanese exports, with the island’s companies shipping graphic processing units and related equipment worth over $42 billion in the last year, compared to almost nothing in recent years.

Those exports were valued at $3.5 billion last month, a nearly 422% increase compared to the same period last year.

5.
Emerging Markets Inflation

Brazil’s annual inflation rate rose less than expected in June as the central bank paused its interest rate cut cycle to counter latent price pressures.

Policymakers halted a nearly year-long series of rate cuts last month as the economy outperforms expectations and investors worry about President Luiz Inacio Lula da Silva’s spending plans.

In Mexico, inflation rose more than expected in June, complicating the central bank’s efforts to cut interest rates, which remain near historic highs.

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