The new economic order
Date: Julio 2026
Funcas Intelligence, July 2026
Contents
The Memorandum between the United States and Iran has significantly reduced fears of a prolonged disruption in the Strait of Hormuz, easing pressures on global energy markets and improving investor sentiment. The ECB raised interest rates by 25 basis points in June, citing renewed inflationary risks from energy markets, while the Federal Reserve kept rates unchanged at its first meeting under Chair Kevin Warsh.
Markets initially expected Kevin Warsh to tilt the Federal Reserve in a more dovish direction, but his first Federal Open Market Committee meeting showed that the committee remains more concerned about persistent inflation than eager to validate expectations of rapid rate cuts. Despite the focus on whether a Warsh chairmanship will lower interest rates, the most likely outcome is a more constrained version of the “Warsh Doctrine” than markets initially anticipated.
While frontier models remain strategically important, competitive advantage is increasingly shaped by access to compute, data centers, energy, distribution networks, financing capacity, and operational deployment. Meanwhile, as Silicon Valley pours hundreds of billions into AI infrastructure, Europe risks remaining an AI consumer rather than an owner of the platforms and networks generating most of its economic value.
Germany’s fiscal expansion marks a historic break in its post-Cold War model and shifts the focus to how welfare, infrastructure, and defense can be financed simultaneously in an aging economy with weak long-term growth prospects. Higher defense and infrastructure spending may boost short-term growth and strengthen European security, but its long-term success will depend on welfare reform, productivity gains, and more effective European defense coordination.
While Washington appears increasingly interested in stabilizing its relationship with Beijing, Europe is becoming more concerned about the impact of Chinese competition on its industrial base. Europe’s challenge is how to remain competitive in a world where both Beijing and Washington are actively supporting their strategic industries.