March 22-28, 2025
Big news. The main news of the week is a deterioration in American consumer sentiment (according to the Conference Board). The lowest in 9 years, if you ignore the Covid slumps of 2020:
Рис. 1
At the same time, as can be seen in the table, the monthly decline is the largest in five months since the local maximum in November. It was in this month, let me remind you, that the elections were held, which Donald Trump won.
Moreover, the expectations component is at a 12-year low, which is due to pessimism about the future of personal finances –
This pessimism may be influenced by political issues. But most likely the main component of this effect is objective in nature: the US economy is not doing very well, as we will see in the next section.
Macroeconomics: The balance of industrial orders in the UK has been in the red for 32 months in a row:
Рис. 3
Manufacturing PMI there (44.6) is at the bottom for 1.5 years:
Рис. 4
And the balance of retail sales at (-41%) fell into the zone of historical anti-records:
Рис. 5
Рис. 6
In such a situation, it is increasingly difficult to play political games, although Prime Minister Starmer is trying. However, he is unlikely to achieve serious success against such a backdrop.
PMI (expert index of the state of the industry; its value below 50 means stagnation and decline) of the Japanese industry (48.3) is the weakest in a year:
Рис. 7
And the composite index (for all industries, 48.5) – for 3 years:
Рис. 8
Canada’s small business optimism has fallen to a record low (25.0 points) in 25 years of data collection.
I wonder if this has anything to do with Trump’s ideas about Canada joining?
Eurozone service sector confidence at its weakest in 10 years (omitting covid):
Рис. 9
The US merchandise trade balance in February only slightly recovered from January’s record deficit:
Рис. 10
Spain’s PPI (industrial inflation index) is +6.6% per year; not counting the Covid spikes of 2021/23, this is an 8-year peak:
Рис. 11
The same indicator for Italy (+6.2% per year) at the top since 2008, if we exclude the same spikes:
Рис. 12
Inflation expectations in Sweden have reached a record high of +9.2% per year in the 40 years of data collection (excluding the 2022/23 war surge):
Рис. 13
In the eurozone, consumer inflation expectations are at their highest in 2.5 years:
Рис. 14
And business expectations for growth in selling prices – for 2 years:
Рис. 15
Eurozone consumer sentiment at worst in a year:
Рис. 16
American sentiment (University of Michigan survey) approaches record lows in 2022:
Рис. 17
Their annual inflation expectations (+5.0% per year) are at the same peaks at that time:
Рис. 18
And inflation expectations over a 5-year horizon (+4.1% per year) are already at their highest in 33 years:
Рис. 19
The number of registered unemployed in France is the highest in 3.5 years:
Рис. 20
The number of unemployed in Germany has been growing monthly for 27 months in a row:
Рис. 21
And it has already reached an 11-year peak (excluding Covid, whose peak, however, is already nearby):
Рис. 22
And the unemployment rate is at its highest in 10 years (also omitting the Covid surge):
Рис. 23
The Central Bank of Mexico cut the interest rate by 0.5% to 9.0%.
The Central Bank of Norway left the rate at the previous level of 4.5%, the highest since 2008
Main conclusions: A sharp decline in sentiment and rising inflation expectations among entrepreneurs and consumers across all developed countries. No surprise: unemployment and sales are at record levels.
And if in the US Trump still has some (controversial) justification that this is a local deterioration of the situation against the backdrop of the beginning of reforms, then in the European Union and Great Britain the situation is completely dismal. All the political games against this backdrop are absolutely understandable. The authorities need at any cost to distract the attention of citizens from the already obvious deterioration of the economic situation.
We understand perfectly well that this is only the very beginning of a structural crisis (the GDP decline has not even come close to the indicators of more than 50% decline from the 2006 maximums), so the crisis will continue and continue. But, apparently, its indicators have reached peaks that modern political elites can withstand. So we are in for serious political changes against the background of the preservation of socio-political models in various developed countries.
А потом, по мере развития кризиса, пойдут и изменения в самих моделях. Будут появляться новые (левые и правые и всё более экстремистские) партии, будут меняться правила выборов, а потом и границы некоторых стран. Уж в Восточной Европе так точно. Весьма возможно, через войны, в том числе гражданские. В общем, скорее всего. Развитие кризиса подошло к следующему этапу.
Ну а мы желаем, чтобы все эти беды миновали наших читателей, тем более, что они давно готовы к потенциальным сложностям и, безусловно, думают на тему о том, как им избежать потенциальных проблем. В том числе с помощью информации, которую они получают от Фонда экономических исследования Михаила Хазина.