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US fiscal policy has been taking up a lot of space in the media lately, first because of the arduous negotiations over plans to curb the effects of the COVID-19 crisis and, later, due to the new stimulus packages proposed by the Biden administration. In this context, another element has appeared on the radar which promises to gain prominence in the coming weeks: the proximity of the debt limit, or «ceiling», and the need to resolve this situation by the end of October so that the government can fund itself normally. There is a feeling that the current US administration is approaching a cliff edge with regards to the public accounts.

The retail trade is one of the Spanish economy’s main service sectors. An atomised sector, it is particularly labour-intensive with a widespread presence throughout the country.

We are entering the final stretch of the year following a summer marked by the Olympic Games in Paris and a brief episode of financial turbulence which was triggered, in part, by fears that the US economy could fall into recession. Those fears have been shown to be somewhat exaggerated and the global economy has seen a continuation of the trend of recent quarters, although the outlook for the final part of the year has weakened. The time has therefore come to adjust the economic and financial outlook scenarios with all the new information that has come to light in recent months.

The outbreak of the war in the Middle East has once again triggered a spike in global uncertainty. As has occurred repeatedly in recent years, we yet again find ourselves in a context in which it is very difficult to make reliable forecasts. It happened during the pandemic, after Russia’s invasion of Ukraine and, more recently, when Donald Trump launched the barrage of tariffs. Although the nature of the shocks and the transmission channels have been different each time, the feeling that we are moving towards an uncertain future is repeated. Once again, it is time to reassess where the Spanish economy stands and analyse its strengths and vulnerabilities in relation to the channels through which this new shock could spread.

The vigorous recovery of the European economy after the pandemic has given way in recent years – in a more hostile geopolitical context – to a situation of weak growth. However, this is not the case across the board, neither geographically nor by sector. In particular, while countries such as Germany and Italy are showing significant apathy, the «European periphery» – so-named in a previous era – continues to show remarkable dynamism, led by Spain and Portugal. A similar contrast is found between the more erratic behaviour of the agricultural, manufacturing and construction sectors – with greater exposure to recent shocks – and the growing role in the economy of skilled services supported by favourable underlying trends such as the digital transformation.

The Spanish economy closed 2025 with solid growth and has kicked off 2026 with figures that remain strong, albeit somewhat lower than those of last year. Together, the indicators published to date are consistent with CaixaBank Research’s forecast scenario, set out in the Focus «The Spanish economy in 2026» in this same Monthly Report, which anticipates GDP growth of 2.4% for this year. This allows the economy to tackle the potential consequences of the war that has erupted in the Middle East from a somewhat more comfortable position compared to other economies, but it is still too early to assess the consequences it could have. These will largely depend on the duration of the conflict and its impact on energy prices, trade routes and, ultimately, on global financial conditions and agents’ confidence. Right now, the risks are clearly skewed to the downside.

The price of electricity, something that would usually barely catch the reader’s attention, has populated the headlines and been a topic of dinner conversations since the middle of the year. This change is not a trivial one: the price of electricity soared beginning in July, and by October it had almost quadrupled the average for 2018-2019. What is the reason for this increase and what impact will it have on the economy? These are the questions that this article attempts to answer.

At the close of this report, the conflict in the Middle East remains unresolved and continues to exert pressure on the price of energy and its derivatives. The duration of the conflict will be crucial in assessing its economic impact. The region produces nearly 30% of the world’s crude oil and 20% of its gas, the latter being a key input in the production of fertilisers and helium, which are essential for semiconductor manufacturing. Additionally, it contains two of the world’s major maritime routes: the straits of Hormuz and Bab-el-Mandeb (in the Red Sea). Moreover, there are factors that could hasten a resolution to the conflict, such as Trump’s declining popularity (which could affect him in the mid-term elections) and the high economic cost of the war. Given the uncertainty of the environment, our economic forecasts are anchored in quoted market energy prices.

Almost five years have passed since the historic agreements to finance the EU’s largest joint economic stimulus programme were reached. The Next Generation EU (NGEU) funds were designed with the dual target of helping to overcome, in the short term, the adverse effects of the COVID-19 pandemic and, in the medium term, to support the structural transformation of the European economy. Here, we review what has been achieved to date and what remains pending.

In an environment still marked by high uncertainty, multiple factors could modify the course of the Spanish economy in the coming months, both for better and for worse. Three of them stand out: the evolution of energy prices, the resilience of the labour market and the execution of the European NGEU funds.

During the years of expansionary monetary policy, the Federal Reserve embarked on an asset purchase programme aimed at injecting liquidity into the economy and stimulating it, with its assets peaking at 35% of US GDP in mid-2022. The inflationary crisis required a restrictive monetary policy which included reducing the size of the central bank’s balance sheet in order to withdraw liquidity from the financial system. In 2025, the Fed announced a slowdown in the pace of its balance sheet reduction process beginning in April. 

Japanese sovereign yields have rebounded since 2022, particularly in the past year, and have exceeded the 2% threshold for the first time in nearly three decades. These movements have sparked a wide debate about the country’s fiscal sustainability and the direction of its monetary policy. In this article, we analyse the factors behind the recent upturn and its consequences for the Japanese economy.