Rising energy prices in Europe are likely to push inflation up even further, despite political measures. With the exception of the real estate market, the US economy has so far turned in a solid third quarter. China with less momentum than expected; consumers remain pessimistic.
Chart of the month
Nominal wages in all developed economies are failing to keep up with inflation. The real wage losses are greatest in Germany and southern Europe, where the economies are confronted with an external energy price shock and wage negotiations often prioritise job security over wage increases. France, Switzerland and Japan upheld their purchasing power slightly better than the worst performers due to lower inflation, as did the English-speaking countries thanks to stronger wage growth. Following surprisingly strong growth in the first half of the year in the Eurozone due to catch-up effects, a marked slowdown in private consumption is consequently foreseeable over the coming quarters.