Search results

Generative artificial intelligence (AI) has traits of a general-purpose technology: applications in many sectors, rapid improvement of the technology itself and a catalyst for complementary innovations. This has already happened with technologies such as electricity and the internet. Even so, having high potential does not necessarily mean an immediate or uniform macro impact. The final magnitude of AI's impact will depend on the speed of its adoption and the ability of firms to reorganise processes. This article examines how AI could affect productivity growth and what it means for the labour market.

The economic impact of the war with Iran is yet to be written. If a deal is reached in the short term and the movement of goods through the Strait of Hormuz resumes relatively quickly, the macroeconomic effect could be limited. Amid the recent emphasis on the downside risks, it is important not to lose sight of this scenario. Not only is it plausible, but it could be the most likely.

Although our attention will remain focused for a while on geopolitics and all its derivatives, the elephant in the room remains the medium-term implications of AI on macroeconomic variables. The risk is of being overly optimistic, but the tip of the iceberg of this megatrend is promising, considering the initial positive effects on US growth and on the earnings of firms in the sector. 

Between 2013 and 2019, the recovery that followed the financial and sovereign debt crises enabled gradual but sustained improvements in household purchasing power, supported by an improvement in employment and a contained inflation environment. The pandemic disrupted this dynamic, and while nominal income and the labour market showed resilience, the inflation shock exacerbated by the invasion of Ukraine eroded purchasing power and strained households’ well-being, hitting low-income households particularly hard. In this context, real actual individual consumption per capita – a broad indicator of material well-being that includes both private expenditure and individual goods and services provided by the public sector – allows us to analyse how the living conditions of European households have evolved before and after the pandemic, as well as the role of public redistribution.

In this second article on globalisation, we analyse the growing fragmentation of the world economy in recent times, focusing on the decoupling between the US and China, and its effects.

When Eurostat publishes GDP growth for the euro area, Germany, France, Italy and Spain are the main drivers of the final result. However, in recent years, Ireland has been responsible for the largest revisions and distortions of the euro area’s figures, both upwards and downwards. How can a country with just 5 million inhabitants have the capacity to alter the statistics of a region with over 350 million people?

The Spanish household savings rate has rebounded for the first time since the pandemic, thanks to a rise in gross disposable income and a fall in inflation, which has moderated the growth in nominal household spending. 

Immigration plays an essential role in ensuring the sustainability of demographics and employment in an ageing society with a very low birth rate like that of Spain. In this article we analyse the recent evolution of immigration flows into Spain, their geographical distribution and their socio-economic characteristics.

The financial markets broadly stabilised during the month of April, as investors' radar moved away from the financial turmoil of March to focus on the growth and inflation outlook, with the publication of GDP data for Q1 2023 and the corporate earnings season.

Competitiveness is a key factor in a country’s economic prosperity. The ups and downs of the business cycle can influence economic growth to a greater or lesser extent. However, over the long term, the fundamental factor that determines an economy’s ability to generate wealth and prosperity in a global environment is competitiveness.

In March, the markets experienced their third big movement so far this year. Whereas January was marked by a slowdown in inflation and renewed risk appetite, which was reversed in February due to the persistence of the cycle and prices, in March the collapse of Silicon Valley Bank in the US triggered a brief but intense episode of panic.

In March, the bulk of the published indicators reiterated a picture of reduced weakness in the economic activity figures and greater inertia in core price pressures. However, the collapse of Silicon Valley Bank triggered an episode of financial turbulence and highlighted that the rapid and sharp rate hikes by the central banks are leading to tighter financial conditions.

To take the pulse of the economy, we usually look at GDP growth. From this perspective, the latest dynamics in the Spanish economy are turning out to be somewhat better than expected. However, the factors on which the growth is supported are just as important, if not more so.

In the last five years, home prices in Portugal have risen by around 63%. Similarly, the number of home sales has amassed 32% growth in the last five years. In this article, we will analyse the impact of this housing market boom on municipal tax revenues related to housing.

Despite the positive growth data for Q4 2022, more than half of the analysts on the Bloomberg consensus panel believe that in 2023 we will see a fall in US GDP for two consecutive quarters. Also, the probability they assign to a recession in the US in the next 12 months is around 70% and the sovereign yield curve has been inverted in the section spanning from three months, an almost infallible predictor of recession. What arguments support this pessimistic view of a hard landing for US economic activity? Are there any reasons to think it is possible to avoid a recession and make a soft landing?