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Cautiously optimistic outlook for the international economy, but with a demanding risk map. The US stands out among advanced economies, while the euro area has not yet left behind its sluggish economic activity. Among emerging markets, India’s growth tops the BRICS, with China giving way to the new leader.

The oil price seems to have boarded a roller coaster, and this makes it very difficult to predict its future trend. In the early stages of the year, oil production limits implemented by the OPEC countries and the recovery in investor sentiment kept the oil price afloat.

In the run-up to the Asia-Pacific Economic Cooperation summit, Donald Trump’s Asian tour has led to a certain thaw in US-China trade relations, in a quarter marked by contrasts among advanced economies and dynamism among emerging markets.

The volatility of the main asset classes continued to decline in December, while liquidity improved in the US and financial conditions were eased, although risks related to geopolitics and AI persist. The main stock indices extended the rally that had begun in November, while long-term sovereign yields rose. The euro consolidated its appreciation in the year, while oil closed down at a four-year low due to oversupply and investors' medium-term reading of the situation in Venezuela. Precious metals experienced a historic rally, albeit not without setbacks.

In this first article in a series of two, we review the recent trends in capital investment in Spain and make a comparison with the rest of the euro area. In a second article in this same Monthly Report, we investigate the incentives for investing, based on an analysis of the evolution of profitability and the cost of financing, sector by sector.

The economy continues to enjoy strong growth, with domestic demand acquiring a more prominent role, largely supported by the buoyancy of the labour market. Electricity keeps inflation at around 3%, while house sales buck the upward trend for the first time since 2024.

After growing by 3.2% in 2024, in 2025 the economy is expected to continue to grow above the euro area average, supported by strong household consumption and the recovery of investment. The major geopolitical challenges and Europe’s weak growth represent the main risk factors.

When there is an increase in uncertainty, households and businesses tend to postpone consumption and investment decisions, which ends up affecting the pace of economic activity. In this article, we attempt to estimate the impact of uncertainty on Spain’s economic growth.

The Spanish economy will have to continue to navigate an adverse and complex international environment. But, for now, it has started the year on a good footing.

It is surprising that the US labour market, known for being one of the most flexible in the world, is taking so long to regain normality, given that GDP recovered pre-pandemic levels back in Q2 2021. Is this a transitional phenomenon or a sign of structural change?

The good performance of the foreign sector, especially services exports, largely explains the significant buoyancy that the Spanish economy is showing. Besides the usual strength of tourism, the strong growth of non-tourism services also stands out.

The CaixaBank Research real estate clock shows the evolution of home prices and sales in Spain throughout the cycle. In 2024, the «clock» will remain in the slowdown quadrant, before giving way to 2025, when we expect the housing market to return to expansive territory.