BBVA Research lowered growth expectations for Spain’s GDP to 2.6 percent in 2018 and 2.4 percent in 2019 (representing a drop of 0.3 and  0.1 percentage points, respectively, from the forecast of three months ago). The downward revision is primarily due to a more modest performance in the first half of the year. Lower growth of both exports and private consumption are two important factors contributing to the revised projections. This was the view detailed in the most recent report on the Spanish Economic Outlook, presented today by Jorge Sicilia, chief economist at BBVA Group and director of BBVA Research; Rafael Doménech, head of Macroeconomic analysis at BBVA Research; and Miguel Cardoso, BBVA Research’s chief economist for Spain and Portugal.

José Manuel González-Páramo called for Europe to move forward now, not “just when there’s a crisis”, and to conclude the banking union, the capital markets union and the fiscal union to have a “much more robust and genuine euro.” Speaking at the Círculo de Economía in Barcelona, he stressed the role that the ECB played in Europe’s recovery. However, the bank must now go back to its original purpose of “contributing to financial stability and separating supervision from monetary policy.”

After the hike in interest rates by the Central Bank of Turkey on September 13 (625 basis points from 17.75 percent to 24 percent), the Turkish government today (Thursday) unveiled a new economic program for the next three years (2019-2021). BBVA Research in a report released Thursday believes that both monetary policy and fiscal policy are now better geared toward correcting inflation and the imbalances of the Turkish economy.

The Central Bank of the Republic of Turkey (CRBT) decided today to raise the official interest rate by 625 basis points from 17.75 percent to 24 percent. As a BBVA Research report points out, the hike came in above market expectations (21 percent according to Bloomberg consensus estimates), and BBVA Research’s own forecast (22.75 percent). BBVA Research welcomes the move and believes it should be backed up by a medium-term coherent and detailed fiscal plan.

The negotiations between Mexico, the U.S., and Canada have been a recurring topic in the news recently. BBVA Research has used big data techniques to monitor the media coverage and tone used by the national media outlets in each North American country as the slow-going renegotiation of this agreement has been reported.

In recent months, concerns surrounding the financial health of the business sector have been on the rise. In particular, market participants are worried that higher price pressures, faster monetary policy normalization, and a trade war, amid stretched valuations, could trigger a significant decline in risk appetite. This would lead to higher borrowing costs and tighter financial conditions.

Political concerns in Italy and the intensification of geopolitical tensions between the U.S. and Turkey set a cautious tone in financial markets last week. The tone was not alleviated by the possibility of an easing in trade disputes between China and U.S.

BBVA Research maintains its GDP growth forecasts for Spain at 2.9 percent for 2018 and 2.5 percent for 2019. The increasing likelihood that some risks might finally materialize could drive the Spanish economy to slower growth scenarios, according to the latest Spain Economic Outlook report published by BBVA’s studies unit. The report was presented today by Jorge Sicilia, Chief Economist of BBVA Group and Head of BBVA Research, Rafael Doménech, Head of Macroeconomic Analysis of BBVA Research and Miguel Cardoso, Chief Economist Spain and Portugal. Under this scenario, the country is expected to generate about 880,000 jobs over the two-year period, causing the country’s unemployment rate to drop below 14%.

“I love food and I am mad about sports.” Hearing him talk about his hobbies, Jaime Sáenz de Tejada (Madrid, 1968) comes across as someone who enjoys life. As a kid he was into basketball and track and field. Later, he got interested in paddle tennis and golf. About a year and a half ago he fractured his thigh bone forcing him to focus a bit more on swimming and cycling. He defines himself as a lover of Peruvian cuisine, because it offers “the best fusion of sensitivities from many places, with ingredients of unparalleled quality.” He’s even given cooking chifa (a fusion of Peruvian ingredients and traditions with Cantonese elements) a go, but “being surrounded by so much talent, I would never dare to compete in culinary skills.” Married and with five children – “one of them is on his way to becoming a chef, just like his mom,”- he’s been a part of BBVA for more than 25 years. In 2014 he became the Group’s Chief Financial Officer. He devotes most of his scant free time to “living his children’s education intensely and sharing activities with them.” He’s been lucky to live in New York – at two different periods – , London, Uruguay and Peru.

The new accounting regulation IFRS 9 aims to buttress financial stability against future crises.  It obliges financial institutions to more faithfully reflect credit risk and calculate provisions for insolvencies following an expected loss model (versus the previous “incurred loss” model). For a majority of financial institutions, this has resulted in an increase in provisions and the subsequent impact on capital.

Emerging economies were amongst the topics addressed at the Institute of International Finance’s (IIF) spring meeting, held in Brussels last week. This BBVA-sponsored event convened financial institutions, regulators and public bodies to debate some of the industry’s most pressing issues, including the economic and political outlook, regulation and fintech.

BBVA Research has raised its growth forecasts for US growth and now sees GDP at 2.8% this year and the next due to the strength of the global economy and the Trump administration’s fiscal stimulus.

“Our way is to help our customers take the best decisions.” In an in-depth interview with Actualidad Económica magazine,  BBVA CEO Carlos Torres Vila explained the profound transformation that BBVA is undergoing. This is a process that is materializing in customized solutions to help the bank’s customers and clients achieve their vital goals, he added.

As we expected, the FOMC increased the Fed funds rate to 1.5%-1.75%, confirming that newly appointed Chairman is committed to maintaining continuity with his predecessor. The language in the statement underpinned the committee’s shift from a defensive to potentially offensive mindset, with strong labor market signals, increased business investment and firmer actual inflation readings.

Timothy Bresnahan, Ariel Pakes and Robert Porter study the impact of businesses in the market. To measure this ability that firms have to control prices in a given industry, the three Frontiers of Knowledge laureates in Economics have developed methods that have had a significant and lasting impact on empirical research in the industrial organization field, as well as in other applied fields like health or environmental economics.

Market analysts reported positively on BBVA’s 2017 results. The majority pointed to the solid underlying trends, the strength of recurring revenues and cost containment as the key drivers of the bank’s solid performance.

Over the past three years, the asset allocation team of BBVA Asset Management has overhauled its investment process to bring as much objectivity as possible to decision-making when building a portfolio. Based on the principles of behavioral economics, the new process aims to determine how the power of the mind affects financial decisions.

BBVA Compass assembled a worldly-wise panel in Houston last week to help its Global Markets clients, all of whom maintain assets outside the U.S., sort through the barrage of global economic news to better understand the risks.

As had been expected, following its monthly meeting the European Central Bank left interest rates unchanged. At the same time, ECB President Mario Draghi introduced the exchange rate as an element of uncertainty, stressing that he will monitor the fluctuations in the euro and their possible consequences. Likewise, he reiterated the possibility of broadening the bond purchase program, continuing his accommodative policy, which will be accompanied by interest rates at minimum levels for a long period of time.

Economic activity in Latin America has been invigorated in recent months, in line with the recovery of confidence among families and businesses and a more favorable external context. In its Latin America Economic Outlook for first quarter 2018, BBVA Research forecasts that the region’s growth will increase from 1.1% in 2017 to 1.7% in 2018 and 2.5% in 2019.

BBVA Research maintains its forecasts for Spain’s GDP growth in 2017 and 2018 at 3.1% and 2.5%, respectively. In addition, it expects that the economic recovery will continue in 2019  (with a 2.3% increase in GDP) and that the improvement in the economy will translate into wage growth. BBVA Research’s latest Spain Economic Outlook was presented today by Jorge Sicilia, Chief Economist of the BBVA Group and Director of BBVA Research; Rafael Doménech, Head of Macroeconomic Analysis at BBVA Research; and Miguel Cardoso, Chief Economist for Spain and Portugal.  If these forecasts prove to be correct, Spain´s unemployment rate could drop to 13.4% by end of 2019, which would imply the creation of 860,000 jobs over the next two years.

In late 2017, the European Commission established a roadmap for deepening the European Economic and Monetary Union (EMU). The plan represented yet another step towards the economic integration of the EU, during a political year marked by the elections in the Netherlands, France and Germany and the Brexit negotiations with the United Kingdom. One of the most far-reaching proposals is transformation of the current European Stability Mechanism (ESM) into a European Monetary Fund (EMF). The year 2018 opens with the challenge of implementing this proposal.

During 2017, the European Union managed to weather populist electoral bids in its member countries, and to keep the Brexit talks on track. But the year to come presents even larger challenges that will require a sustained, collective effort by EU leaders, says BBVA Executive Director José Manuel González-Páramo.

Agriculture has become the driver of the Argentine economy. Heavy investment in infrastructure (roads, trains, hydraulic construction) will help to improve costs, opening the road to a growth which seems infinite, thanks to a persistent and solid demand.

Once again, the Argentine economy faces critical decisions to avoid a new downturn and take the path to more sustainable growth. Markets are keeping a close eye on the post-electoral roadmap outlined by the administration of President Mauricio Macri.

The outlook for Argentina’s economy in 2018 remains optimistic, with GDP expected to expand by nearly 3% for the second consecutive year. However, achieving sustained growth and attracting international investment will depend, not just on stable macro indicators, but on long-lasting structural reforms. While the initial signs of economic recovery became apparent in the second half of 2016, it wasn’t until mid-2017 that growth rates began to pick up across most industries.

The oldest private domestic bank in Argentina and one of the leaders in Latin America, BBVA Francés on October 14 marked its 130th year in operation and its 21st year as part of the BBVA Group. In the course of its history, BBVA Francés has gone from being a 20th century “temple of money,” to a powerhouse of digital banking in the Argentina of the 21st century.

Car sharing and driverless cars are shaking the very foundations of the automobile industry. Will technology make car ownership obsolete?

Big Data Spain brought together more than 1,200 specialists in data analysis and science in Madrid for two days, during which it was made clear how this technology can bring a new dimension to any area: from marketing to user experience to economic and geopolitical analysis.

The refugee crisis, political events and the social reaction to them, natural disasters such as Hurricane Harvey or Hurricane Irma, the sentiments of people or central banks… there is an ever-increasing number of events whose economic impact, in a world of growing risk and uncertainty, is hard to gauge using traditional methods. That’s where ‘Big Data’ and ‘Data Science’ techniques come in, helping to quantify these trends from micro to macro level.

The Bilbao headquarters of BBVA was one of the stops on a tour of Spain by future U.S. leaders. BBVA is the only Spanish financial institution involved in the “U.S. Young Leaders” program, which was launched in 2000 by Fundación Consejo España-Estados Unidos and the US-Spain Council.

Latin America will be one of the leaders of the global economy. The digital transformation has been one of the keys to this reduction in poverty and improvement in social indicators. But how has it helped? One example is digital financial inclusion.

The European Commission (EC) and the European Banking Authority (EBA) have published their work plans for 2018. The documents describe the specific activities and tasks the organizations plan to carry out next year. Both proposals place increasing importance on the fintech sector, since it could bring about a radical change the financial industry.

According to BBVA Research’s latest Spain Outlook report, 2017 will cap off Spain’s three-year run of GDP growth at rates above three percent. Recovery will continue in 2018, but at a slower pace, in an environment marked by rising uncertainties. The report was presented today by Jorge Sicilia, Chief Economist of BBVA Group and Head of BBVA Research, Rafael Doménech, Head of Macroeconomic Analysis of BBVA Research and Miguel Cardoso, Chief Economist Spain and Portugal. Considering this scenario, BBVA Research has downgraded its GDP growth forecasts for 2017 and 2018 to 3.1 and 2.5%, from 3.3% and 2.8% in July.

Digitization is primarily an English term. According to a report, the U.S. and U.K. are the countries whose economies are the most prepared for a fourth industrial revolution.

• Operating income: Recurring revenues continued their upward trend, growing 4.2% between January and September. This, together with cost containment efforts (expenses dropped 1.7% in the year to September), drove operating income to a record €9.52 billion
• Risks: The NPL ratio continued to improve, reaching 4.5% in September (vs. 4.8% in June), the lowest level in the past five years. Coverage increased to 72%
• Capital: The fully-loaded CET1 ratio rose to 11.2% in September, reflecting a capital generation of 30 basis points in the first nine months of the year
• Transformation: The digital customer base grew 24% y-o-y to 21.1 million in September. Of these, the number of customers banking with their smartphones surged 43% to 15.8 million

BBVA Research has upgraded its Latin America 2017 growth forecast by 30 basic points, citing improvement in domestic demand in Mexico and Peru. The BBVA Group study service expects the region to grow 1.1% in 2017 and 1.6% in 2018.

The European Commission has published a legislative proposal to create a sort of European Securities and Exchange Commission – that is, a European agency that would centralize some of the stock exchange supervision competencies of the national authorities. Once it is approved, part of the activity that takes place on the European exchanges would come under control of the new European authority.

The country risk premium is the return that investors demand from a country to buy its sovereign bonds in comparison with that demanded from other countries. It is calculated as the difference between the interest rate of a country’s bonds compared to bonds issued by a benchmark country, considered “riskless.”

After seven years of negotiations, the Canada-Europe Trade Agreement, CETA, has entered into force provisionally.  Under this bilateral agreement, the most ambitious signed to date by Brussels, most custom duties levied on trade flows between both countries will be scrapped.

The recent elections in Germany have ended this year’s electoral cycle in Europe. With euroscepticism weighing in at the ballot box, it’s now up to the European Union to bring its institutions closer to the continent’s citizens, according to José Manuel González-Paramo, Executive Director of BBVA, speaking at a conference on “The New Europe: Challenges and Opportunities” organized by ADEIT.

BBVA Research USA economists revised upward their estimate of the economic impact of Harvey, putting it at up to $111 billion, which would make it the second most costly natural disaster in recent U.S. history after Hurricane Katrina.

Speaking this morning at the 22nd annual meeting organized by Bank of America Merrill Lynch in London, Chief Financial Officer Jaime Sáenz de Tejada explained some of the key aspects BBVA’s strategy to investors.  “BBVA is well positioned for the new growth cycle”, thanks to a solid balance sheet and capital position, as a result of the company’s efforts in recent years, its geographic diversification and forward-looking transformation strategy.

When you have a storm as destructive as Hurricane Harvey hit one of the most important state economies in one of the world’s most powerful economies, the question is natural: How might the effects ripple in unexpected ways? We talked to the economists at BBVA Research USA to help offer perspective.

Known as one of, if not the, oil and gas hub of the United States, the East Texas region suffered another dire consequence of Hurricane Harvey’s ripple effect: the interruptions to the energy companies who had set up shop in the affected areas.

After barreling into the state of Texas, as one of the largest and most damaging Hurricanes in U.S history, Hurricane Harvey continues to devastate the Corpus Christi-Houston-Galveston area with catastrophic destruction, human losses, and unprecedented flooding.

As the region begins to pick up the pieces in the weeks, months and years to come, there is a growing concern about the impact that Hurricane Harvey will have on the regional and national economy.