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The Spanish economy continues to have the highest structural unemployment rate in the European Union, despite having managed to reduce it substantially in recent years. To curb it, improvements are needed on three fronts: greater supply and demand for employment and better matching between the two.

We recap the phases of the recent inflationary cycle and analyse the evolution of intermediate costs, which are decisive for containing the triggering of second-round effects and ensuring price stability.

The conflict between Russia and Ukraine and the sanctions imposed on Russia have highlighted the vulnerability of the global growth model to energy supply shocks.

This time monetary policy cannot and should not be the main tool used to tackle the crisis stemming from the war in Ukraine. It cannot, because interest rates are already at very low levels. Moreover, the high inflation is forcing the central banks to act with extreme caution.

As of the close of this report, military and economic pressure continues around the Strait of Hormuz, a key route for the global supply of oil, gas, and derivative products. The IMF, in its April outlook report, points out that despite the strong start to 2026 globally, there is a risk of a severe energy shock if hostilities persist.

We look at the dangers of a wage-price spiral in the US and the euro area, in the current context of inflationary pressures. 

The outbreak of the pandemic in 2020, and more recently the war in Ukraine, has accelerated the trend of decoupling between the US and China, and Europe also appears to have joined in, albeit somewhat timidly for now. We analyse the EU’s dependence on China in order to understand whether European strategic autonomy is possible, or even desirable.

Markets remained affected by the supply shock in May, particularly in the euro area. In an uncertain geopolitical environment with mixed signals, markets welcomed the favourable signs of rapprochement between the US and Iran. As a result, May saw a reduction in oil prices and consequently a slight moderation in short-term inflation expectations.

Employment in Spain has experienced rapid growth in recent years. The unemployment rate has also fallen sharply, but it remains one of the highest in the euro area. Can the labour market continue to support Spain’s economic growth?

The challenge for economic policy is to maintain the resilience of an increasingly complex, interconnected and uncertain economic system. As Keynes warned, the challenge lies not so much in developing new ideas as in escaping old ones, thus freeing ourselves from inherited mental frameworks.

Financial markets experienced a rather intense and volatile summer, driven by the ongoing conflict in the Middle East and tensions in energy prices, which consequently put pressure on inflation and monetary policy expectations.