Economics highlights (week 26/2022)
Updated: Aug 21, 2022
Find out highlights on European Central Bank Forum on Central Banking 2022 and key macroeconomic indicators published this week.
"Is there a risk that we would go too far? Certainly, there's a risk, but I wouldn’t agree that it's the biggest risk to the economy. The bigger mistake to make, let's put it that way, would be to fail to restore price stability."
Wednesday 29th, Jerome H. Powell
Federal Reserve Chair
European Central Bank Forum on Central Banking 2022
The ECB organized the annual forum this year in Sintra, Portugal bringing together the world's top central bank chiefs. The focus was inflation and what central banks can do to bring it down without causing a recession.
ECB President, Christine Lagarde on Tuesday 28th, played down concerns about a recession in the euro zone, also affirming her team is ready to raise rates at a faster pace — if needed — if inflation continues to shoot higher.
“We have markedly revised down our forecasts for growth in the next two years. But we are still expecting positive growth rates due to the domestic buffers against the loss of growth momentum,” Tuesday 28th, Christine Lagarde, ECB President.
The European Central Bank has signaled rate hikes in both July and September while the Fed increased rates by 0.75 percentage points in June and may do the same in July.
EURO Area Unemployment
Today was published the euro area seasonally-adjusted unemployment rate for May 2022 which resulted 6.6% (6.7% in April 2022 and 8.1% in May 2021). Eurostat estimates that 13.066 million men and women in the EU, of whom 11.004 million in the euro area, were unemployed in May 2022. Compared with May 2021, unemployment decreased by 2.515 million in the EU and by 2.165 million in the euro area. Source: EUROSTAT
US Consumer Confidence
The Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity.
US consumer confidence dropped in June to the lowest in more than a year as inflation continues to worry the American citizens.
The Conference Board’s index decreased to 98.7, data Tuesday showed. The median forecast in a Bloomberg survey of economists called for a decline to 100.
US GDP Price Index
The US gross domestic product price index, which measures changes in the prices of goods and services produced, jumped 8.3% on quarter in the first three months of 2022 to a record high of 123.583 points.
China’s factory activity expands for first time in four months
After three months of contraction, China’s factory activity expanded in June, as the strict lockdown in Shanghai ended, buoying growth in production and new orders.
The official manufacturing purchasing managers’ index (PMI) rose to 50.2 in June, (49.6 in May) the National Bureau of Statistics (NBS) said on Thursday.
A Reuters poll expected the PMI to come in at 50.5 (the 50-point mark separates contraction from expansion on a monthly basis).