European Economic Outlook

With transatlantic trade tensions escalating fast, and the United States rolling out a new wave of tariffs on key partners—including the European Union—Europe faces a moment of reckoning for its trade strategy. In the latest Future is Blue podcast, I sat down with two top experts to unpack what’s at stake: Ignacio García Bercero, non-resident fellow at Bruegel and former EU chief trade negotiator with the U.S., and Miguel Ángel González Simón, economist at Funcas.

In the aftermath of the eurozone sovereign debt crisis, countries such as Spain, Portugal, Greece, Ireland, and Italy became synonymous with economic fragility. Yet, under a decade on, a remarkable narrative shift is underway, with these so-called peripheral economies now outpacing Europe's traditional economic powerhouses in growth, investor confidence, and reform momentum.

As geopolitical tensions rise and the transatlantic alliance faces uncertainty, the question of Europe’s defence capabilities has become more pressing than ever.

In a rapidly changing global landscape, the European Union (EU) faces unprecedented challenges to its industrial production and trade relationships. From the impacts of the ongoing war in Ukraine to increasing tensions with the United States and China, Europe’s economic model, long reliant on exports, is being put to the test. This was the focus of the latest Future is Blue podcast episode, where I hosted Aslak Berg, Research Fellow at the Center for European Reform, and Miguel Ángel González Simón, economist at Funcas, for an insightful discussion on the EU’s vulnerabilities and paths forward.

In a rapidly changing global landscape, the European Union (EU) faces unprecedented challenges to its industrial production and trade relationships. From the impacts of the ongoing war in Ukraine to increasing tensions with the United States and China, Europe’s economic model, long reliant on exports, is being put to the test. This was the focus of the latest Future is Blue podcast episode, where I hosted Aslak Berg, Research Fellow at the Center for European Reform, and Miguel Ángel González Simón, economist at Funcas, for an insightful discussion on the EU’s vulnerabilities and paths forward.

In a rapidly changing global landscape, the European Union (EU) faces unprecedented challenges to its industrial production and trade relationships. From the impacts of the ongoing war in Ukraine to increasing tensions with the United States and China, Europe’s economic model, long reliant on exports, is being put to the test. This was the focus of the latest Future is Blue podcast episode, where I hosted Aslak Berg, Research Fellow at the Center for European Reform, and Miguel Ángel González Simón, economist at Funcas, for an insightful discussion on the EU’s vulnerabilities and paths forward.

In a rapidly changing global landscape, the European Union (EU) faces unprecedented challenges to its industrial production and trade relationships. From the impacts of the ongoing war in Ukraine to increasing tensions with the United States and China, Europe’s economic model, long reliant on exports, is being put to the test. This was the focus of the latest Future is Blue podcast episode, where I hosted Aslak Berg, Research Fellow at the Center for European Reform, and Miguel Ángel González Simón, economist at Funcas, for an insightful discussion on the EU’s vulnerabilities and paths forward.

In a rapidly changing global landscape, the European Union (EU) faces unprecedented challenges to its industrial production and trade relationships. From the impacts of the ongoing war in Ukraine to increasing tensions with the United States and China, Europe’s economic model, long reliant on exports, is being put to the test. This was the focus of the latest Future is Blue podcast episode, where I hosted Aslak Berg, Research Fellow at the Center for European Reform, and Miguel Ángel González Simón, economist at Funcas, for an insightful discussion on the EU’s vulnerabilities and paths forward.

Donald Trump’s return to the White House has set the stage for a potentially turbulent period in transatlantic relations.

Migration is fuelling heated political debates in host countries. To shed light on the reality of its economic impact, Future is Blue podcast host Carlos Carnicero Urabayen interviewed Ana Damas de Matos, a senior policy analyst at the Organisation for Economic Co-operation and Development (OECD). Drawing on years of research, Damas de Matos provided insight into the fiscal contribution of migrants, effects on the labor market and related policy responses.

The latest Future is Blue episode covers the volatility sweeping EU sovereign debt markets in the wake of France’s election results. In an in-depth conversation with Carlos Carnicero Urabayen, Alice Faibishenko, Senior Advisor at Funcas, sheds light on the financial turbulence triggered by budget uncertainties in France and its effects across the eurozone.

In a new episode of the Future is Blue podcast series we covered the implications of the Mario Draghi report, a landmark document that calls for urgent and bold reforms to address Europe’s economic decline. Joined by Sander Tordoir, Chief Economist at the Centre for European Reform, and Raymond Torres, Director of Funcas Europe, we examine Draghi's proposals and the challenges they pose to EU leaders.

In a recent episode of the "Future is Blue" podcast, Carlos Carnicero Urabayen sat down with Alice Faibishenko, Senior Advisor at Funcas, to discuss the latest developments in the European Central Bank's (ECB) monetary policy. The conversation covered the ECB's recent rate cut, contrasting approaches with the U.S. Federal Reserve, and the broader implications for financial markets, financial sectors, and households and firms, particularly in Spain.

In a recent episode of the "Future is Blue" podcast, Carlos Carnicero Urabayen sat down with Alice Faibishenko, Senior Advisor at Funcas, to discuss the latest developments in the European Central Bank's (ECB) monetary policy. The conversation covered the ECB's recent rate cut, contrasting approaches with the U.S. Federal Reserve, and the broader implications for financial markets, financial sectors, and households and firms, particularly in Spain.

La recuperación que se esperaba a inicios de año no se está materializando, a tenor del débil avance del PIB de la eurozona en el segundo trimestre, un 0,3%, lo mismo que el trimestre anterior. Los resultados, sin embargo, son dispares: las economías con más peso de la industria como Alemania tienen un comportamiento peor que las más dependientes de los servicios, particularmente del turismo, como España.

In the latest episode of the Future is Blue podcast, host Carlos Carnicero Urabayen covers the post-election economic outlook for Europe, joined by Sander Tordoir, Chief Economist at the Centre for European Reform, and Raymond Torres, Director of Funcas Europe. The discussion centers on the key economic challenges and opportunities facing the EU as the new political cycle gets into motion after the European elections.

In a recent episode of Funcas’ Future is Blue podcast, we hosted Professor Iain Begg from the London School of Economics and Political Science and Raymond Torres, Director of Funcas Europe, to discuss the European Union (EU) budget and the pressing need for its reform. We covered the historical context, current challenges, and potential future directions for the EU budget

In a recent episode of Funcas’ Future is Blue podcast, we hosted Professor Iain Begg from the London School of Economics and Political Science and Raymond Torres, Director of Funcas Europe, to discuss the European Union (EU) budget and the pressing need for its reform. We covered the historical context, current challenges, and potential future directions for the EU budget

In a recent podcast interview, Carlos Carnicero Urabayen spoke with Hans Dubois, a Senior Research Manager at Eurofound, about the pressing issue of housing affordability in Europe

Spain has long grappled with the challenge of unemployment. In recent decades, the labor market has stood as a testament to the country's economic challenges. Yet, as a recent Future is Blue podcast episode highlights, there is a budding resilience in the Spanish labor force, highlighting evolution from the historical trends of high unemployment, particularly during times of economic uncertainty.

In a new Future is Blue podcast show hosted by Carlos Carnicero Urabayen, Sander Tordoir, Senior Economist at the Centre for European Reform, delved into the intricate dynamics of the global geopolitical landscape, the rise of economic nationalism and Europe's strategic positioning amidst the assertive manoeuvres of superpowers like the United States and China.

Recent economic challenges and geopolitical rivalries have transformed the perception of the benefits derived from international trade and cooperation. While the early 1990s saw the creation of trade agreements and open economies marking a period of global transformation and collaboration, the past two decades have seen globalization viewed more as a source of risks than as a catalyst for growth.

La economía europea ha capeado mejor de los previsto las consecuencias de la pandemia, la guerra en Ucrania, la crisis energética y el giro copernicano de la política monetaria. Una recesión de gran magnitud ha podido evitarse, y las previsiones apuntan a una ligera recuperación en el transcurso del año, evidenciando una resiliencia notable.

Following a long negotiation period, the EU has reached an agreement on new fiscal rules. The revised framework represents a compromise between the more hawkish positions which advocate a rapid return to fiscal balance and the need for a gradual approach that preserves growth prospects.  What will be the impact of the new framework for Europe’s economy in the medium and long term?

Following a long negotiation period, the EU has reached an agreement on new fiscal rules. The revised framework represents a compromise between the more hawkish positions which advocate a rapid return to fiscal balance and the need for a gradual approach that preserves growth prospects.  What will be the impact of the new framework for Europe’s economy in the medium and long term?

Before we close 2023, we wanted to share with you some of our most successful content of the year.

Today we take a bit of a step back and reflect on key developments that have impacted European public finances in the last couple of years.

Today we take a bit of a step back and reflect on key developments that have impacted European public finances in the last couple of years.

The European Commission's decision to investigate the impact of state subsidies on Chinese electric vehicle (EV) imports in the European market has ...

China's debt has been rising dramatically over the past decade. Some are arguing that this represents a risk for its own stability and that, ultimately, considering China's size, a bursting of the debt bubble could trigger a new episode of global financial stress.

Today we discuss EU-China economic relations, a critical topic. China is the EU's second-largest trading partner, and the EU is China's largest trading partner, highlighting the high degree of economic interdependence. However, this relationship poses significant challenges such us trade imbalances (to the detriment of the EU), emerging technological gaps, state subsidies and claims of unfair competition.

Today we discuss EU-China economic relations, a critical topic. China is the EU's second-largest trading partner, and the EU is China's largest trading partner, highlighting the high degree of economic interdependence. However, this relationship poses significant challenges such us trade imbalances (to the detriment of the EU), emerging technological gaps, state subsidies and claims of unfair competition.

Today we discuss EU-China economic relations, a critical topic. China is the EU's second-largest trading partner, and the EU is China's largest trading partner, highlighting the high degree of economic interdependence. However, this relationship poses significant challenges such us trade imbalances (to the detriment of the EU), emerging technological gaps, state subsidies and claims of unfair competition.

Today we discuss EU-China economic relations, a critical topic. China is the EU's second-largest trading partner, and the EU is China's largest trading partner, highlighting the high degree of economic interdependence. However, this relationship poses significant challenges such us trade imbalances (to the detriment of the EU), emerging technological gaps, state subsidies and claims of unfair competition.

Today we discuss EU-China economic relations, a critical topic. China is the EU's second-largest trading partner, and the EU is China's largest trading partner, highlighting the high degree of economic interdependence. However, this relationship poses significant challenges such us trade imbalances (to the detriment of the EU), emerging technological gaps, state subsidies and claims of unfair competition.

Given the importance of the evolution of prices to the outlook for monetary policy and hence, the overall macro picture, in today's newsletter we focus on the recent performance of one of the EU countries where disinflation is most visible, namely Spain.

There are some good news in this front. Inflation in the eurozone has fallen to its lowest level since Russia invaded Ukraine

Welcome to our newsletter about European economic affairs bringing together top experts from academia and think tanks to discuss the most pressing economic challenges of today. Future is Blue is promoted by Funcas. 

This week we are taking a closer look at the recent evolution of the Euribor, the key reference for the European financial markets, in terms of its impact on the banking sector.

A few weeks ago we were discussing about the improved economic prospects for 2023 and the possibility to avoid a recession this year in the EU. 

In the meantime, however, financial markets have entered a period of turbulence in the aftermath of the collapse of Silicon Valley Bank. To get a grasp of the economic impacts for Europe of this new shock, we have reached out to Iain Begg, Professor at LSE, who's joining our podcast show this week with Raymond Torres, Funcas Europe Director, and Carlos Carnicero Urabayen, our host. More details below.

Did you know that 2022 marked a record year for rate increases? All around the world central bankers raised interest rates a 200 times, smashing the last record which dated to 2006 (120 increases).

Is the IMF getting it right with its latest predictions about the world economy? According to its latest global outlook, the world economy will slow this year as central ...

What to expect in Europe's economy in 2023? We can't think of a more pertinent question to restart our podcast series this season.

It's been quite a year for stock markets globally. The losses have been massive and financial actors are having to confront a highly uncertain environment.

It's been quite a year for stock markets globally. The losses have been massive and financial actors are having to confront a highly uncertain environment.

On 22 October, Giorgia Meloni was officially sworn in as Italy’s prime minister. The new Italian government will have to tackle soaring energy prices and support struggling families and businesses, among other challenges.

Is globalization going into reverse mode? Disruptions in supply chains caused by the Coronavirus lockdowns, together with the war in Ukraine and the economic and trade war that the West is fighting with Russia are more and more seen as evidence of a deglobalization trend. Obviously, the implications of a deglobalizing world are enormous for the world economy and for the EU in particular.

Policy responses across Europe to address the energy crisis have obvious similarities, but they also show some relevant differences. Dependencies on Russian gas and the health of public finances to provide state aid are two of several factors that are conditioning how EU Member States are responding individually to this challenge.

Policy preparations for Europe's most complicated winter are under way. EU countries have approved a number of measures in the last few weeks to guarantee energy supplies and support private consumers and businesses to cope with expensive bills.

Back-to-school will be bumpy for businesses and citizens in Europe. We are experiencing a record level of inflation and the cost of everyday essentials like energy and food is rising much faster than average incomes.

After a couple of weeks off, we are restarting our activities today. We hope you are making the most of your summer break.
In today's newsletter, we are sharing with you our latest podcast featuring Alice Faibishenko, Senior Advisor at Funcas think tank and a founding partner of the E3 Partnership, a firm focused on market intelligence and advisory services.

After Christine Lagarde announced a few days ago a substantial increase in interest rates (0,5%) and an anti-fragmentation mechanism - so called TPI - to prevent another debt crisis, we've asked Raymond Torres, Funcas Europe Director, to explain the main drivers behind this important decision. Don't miss our latest podcast.

As economic prospects deteriorate sharply, there are questions about what will happen to the real estate sector and the housing market. Are we safe from the bubble burst nightmare days that we suffered during the global financial crisis a little over a decade ago?

Back in the 70s developed economies were particularly hit by rising prices and low economic growth. There were two oil crises, currency turmoil and rising unemployment. Inflation reached 15% in the US in 1980.

As the war in Ukraine has now gone on for over 100 days, its global economic consequences are becoming more and more visible and represent quite a concern for policymakers.

Today we are covering how State guarantee programs have played a key role to support businesses during Covid and what are the broader implications of these programs for our economies.

Today we are here to cover the global battle for the production of semiconductors and whether Europe has a real plan to lead in this area.

It's been over one month since Russia started the invasion of Ukraine. Since the 24th of February, the EU, together with key allies such as the UK, the US and others, have approved up to five rounds of sanctions against Russia, targeting some of its most critical sectors but leaving - at least for now - gas and oil outside of the equation.

Today we are back to cover sanctions, perhaps the word that's been pronounced the most in the EU political corridors over the last few weeks.

This week we are revisiting the topic with concrete ideas on how the new rules should actually take shape.

This week we are revisiting the topic with concrete ideas on how the new rules should actually take shape.

This week we are revisiting the topic with concrete ideas on how the new rules should actually take shape.

This week we are revisiting the topic with concrete ideas on how the new rules should actually take shape.

This week we are taking a close look at what happened at the UN COP26 Glasgow summit. Are we going in the right direction in the fight against climate change after this important event?

This week we are taking a close look at what happened at the UN COP26 Glasgow summit. Are we going in the right direction in the fight against climate change after this important event?

This week we are touching on the issue of labour shortages, a challenge that is affecting most advanced economies and that could complicate recovery after the pandemic.

This week we are covering the energy price crisis. This is a subject that is very concerning as many fear we are approaching an expensive winter.

This week we are focusing on the results of the German election. The stakes are obviously high for Germans, but also for Europe as a whole. It’s no secret the weight that the future German government will have on the EU’s key economic discussions.

This week we are taking a look at Europe’s main economic risks. What are the main concerns for policymakers as they come back to their office after the summer break? We’ve hosted a podcast conversation with Raymond Torres, Funcas Europe Director, and Carlos Carnicero Urabayen, Future is blue editorial coordinator.

We start the new course with a video interview about the Fit for 55 Commission proposal, the legislative roadmap to trigger a green transformation in Europe and meet the target of cutting greenhouse emissions by 55% in 2030. Our editorial coordinator Carlos Carnicero Urabayen has interviewed Lara Lázaro, Senior Analyst at Elcano Royal Institute. More on this below.

Previsiones económicas para la zona euro, 2021-2022

[a] Contribución al crecimiento del PIB.
Fuente: Eurostat y Funcas (previsiones).

Descargar (formato pdf)

This week we are covering the prospects for a global recovery from the Covid crisis. We have reached out to Professor Karnit Flug, Vice President of Research and Willian Davidson Senior Fellow for Economic Policy at the Israel Democracy Institute, to discuss current trends.

This week we are covering the Spanish recovery plan to fully understand how the Spanish government is working to take full advantage of the EU Next Generation programme.

Since the start of the year, the world economy is witnessing a significant increase in a wide range of commodity prices as well as lags in the delivery key inputs, such as semi-conductors.

This week we are covering state aid, a policy instrument that is becoming more and more critical as the pandemic is hitting the EU economies for longer than expected. We’ve had a video discussion between Peter Bofinger, Professor for Monetary and International Economics at Würzburg University, hosted by Future is blue editorial coordinator Carlos Carnicero Urabayen.

This week we are covering Italy’s economic prospects under the new leadership of Mario Draghi. We’ve recorded a podcast discussion with Orsola Costantini, Economic affairs officer at UNCTAD, hosted by Carlos Carnicero Urabayen, Future is blue editorial coordinator.

This week we are covering Europe’s mounting public debt. There is widespread agreement that EU governments had to act quickly and massively in response to the crisis.

This week we are having a closer look at the impact of vaccine delays on Europe’s economy. Don’t miss our podcast where Christian Odendahl, Chief Economist at the Centre for European Reform, and myself respond to questions from Brussels journalist Carlos Carnicero Urabayen. More details below.

This week we are covering what to expect for the European economy in 2021.

On our side, we have prepared this first newsletter of 2021 looking ahead to try understand what will matter the most over the next few months.

This week we are very pleased to share with you a new podcast, the first of more to come about Europe’s economic and policy-related challenges. We hope that over the next months we will bring new ideas for a more inspiring debate about Europe.

mayo 2020

Previsiones económicas de Funcas para la eurozona 2018-2019

[a] Contribución al crecimiento del PIB.
Fuente: Dirección de Coyuntura y Estadística de Funcas (www.funcas.es); Haver Analytics.

Desde el inicio del año, la economía de la eurozona ha acelerado su recuperación. Los indicadores de actividad y de confianza de los consumidores han repuntado, mejorando ligeramente los niveles anteriores a la crisis.

Indicadores económicos de Funcas para la eurozona 2017-2018

The eurozone economic recovery has accelerated since the start of the year. Activity and consumer confidence indicators have spiked, slightly outperforming pre-crisis levels (Exhibit 1). Meanwhile, international trade flows both within the eurozone and with third countries have increased, in line with the recovery in global markets. GDP grew by 0.6% in the first quarter and 1.9% relative the same quarter of 2016 (Table 1). All countries in the single currency saw a pick-up in growth compared to the last quarter of 2016.