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Macroeconomics

06 Jul 2018

The European Council meeting held on June 28 and 29 took some steps toward euro reform; conclusion of agreements will likely occur at the next meeting in December. Although it was hoped that the summit would address key questions like the budget proposed by Germany and France, ultimately the European partners chose to adopt a minimum agreement. The agreement includes measures such as support for a banking resolution fund, but the reform of the euro was deferred.

03 Jul 2018

After the bare minimum agreement on the banking union achieved at the recently held European Council, the debate about the future of Europe continues unabated. With this agreement still fresh, the Bank of Finland invited scholars, representatives of the financial sector and regulators talk about the future of the Old Continent. The experts gathered in Helsinki called for advancing towards a greater banking and capital markets union. The next date in the calendar: The European Council meeting in December.

28 Jun 2018

The Council of Europe will hold its June summit at a complex time with significant challenges on economic, political, and social issues. As BBVA Research points out, it also represents an opportunity to further strengthen the EU’s Economic and Monetary Union. As such, the reform of the euro will be one of the decisive elements, although also one of the most controversial.

19 Jun 2018

As the European Central Bank celebrates its 20th anniversary, we take a look back at some of its defining milestones. Not in vain, the ECB has been the guarantor of the euro’s survival and, since 2014, the central axis of the euro area’s financial system. Since the onset of the 2008 financial crisis, the ECB took on a role that was pivotal for a huge part of the recovery. However, “it cannot act alone”: “further strengthening of Europe´s institutional and legal framework is necessary to construct a more united and resilient Europe to face future challenges.”

13 Jun 2018

Every time Mario Draghi speaks at the news conference after the European Central Bank’s (ECB) monthly monetary policy meeting, the markets hold their breath. And after he finishes, they react. In the wake of the 2008 crisis, the expectations created by the bank’s message have taken on added relevance. BBVA Research is aware of the importance of being able to gauge if the ECB’s message adequately reflects its policy and has used big data techniques to this end.

04 Jun 2018

16 May 2018

Of the tax revenue paid by Europeans, only one euro per taxpayer is used to finance the EU’s budget. In total, the EU manages a budget of about 1% of the gross national income of its member states. Nonetheless, how this money is invested directly impacts Europeans’ lives; it is therefore of interest to understand the EU budget as of 2021, the first spending plan after the UK’s exit from the EU.

27 Apr 2018

As expected, the European Central Bank left interest rates and its asset-purchasing program, or quantitative easing (QE), unchanged. After its policy meeting, Mario Draghi instead stressed concerns about the global risks posed by protectionism as well as the need to focus on inflation.

20 Apr 2018

The Eurosystem is the monetary authority of the euro area. It comprises the European Central Bank (ECB) and the national central banks of the Member States whose currency is the euro. Its primary objective is the maintenance of price stability, and specifically, keeping inflation in the euro area (calculated based on internal stats of the ECB) “close to but under 2 per cent.”

18 Apr 2018

12 Apr 2018

Fears of a trade war between the U.S. and China are escalating by the day. Trump announced extra duties on 10% of Chinese imports and the two world powers have entered into a “tit-for-tat” trade retaliation that has unnerved investors and shaken financial markets. Nevertheless, the likelihood that these skirmishes will turn into a full-blown trade war are still low, as explained in a BBVA Research report.

10 Apr 2018

Although the uncertainty surrounding Catalonia’s economic policy hasn’t had the expected negative impact, the favorable global environment seems to have offset the its negative effect on production and employment. Consequently, BBVA Research has upgraded its 2018 and 2019 GDP growth forecasts for Spain to 2.9% and 2.5% from 2.5% and 2.3% respectively. 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 940,000 jobs over the two year period, causing the country’s unemployment rate to drop below 14%.

21 Feb 2018

On January 31st, the European Banking Authority (EBA) announced the formal launch of this year’s EU-wide stress test exercise of the euro area. It also unveiled the macroeconomic scenarios under which the exercise will be carried out. The  adverse scenario implies a deviation of EU GDP from its baseline level by 8.3% in 2020, resulting in the most severe scenario to date. The EBA expects to publish the results of the exercise by 2 November 2018

15 Feb 2018

02 Feb 2018

31 Jan 2018

26 Jan 2018

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.

25 Jan 2018

16 Jan 2018

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.

10 Jan 2018

Today marks the second anniversary of death of David Bowie, a pop icon who needs no introduction. Hundreds of lines have been written about his life, career and concerts. But what many are not aware of is that Bowie was also a pioneer in the financial world: he was the first artist ever to issue a “celebrity bond.”

04 Jan 2018

13 Dec 2017

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.

23 Nov 2017

13 Nov 2017

07 Nov 2017

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.

27 Oct 2017

  • 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

19 Oct 2017

17 Oct 2017

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.

11 Oct 2017

A group of BBVA representatives, led by the Executive Chairman Francisco González, will travel this week to participate in the most important economic event of the year: The annual meeting of the International Monetary Fund (IMF) and the World Bank (WB).  This week is surely marked red on Christine Lagarde (Managing Director of the IMF) and Jim Yong Kim’s (president of the World Bank) calendars.  Representatives of the world’s top financial institutions will meet in Washington from October 9 to 15 to discuss topics such as the future of work in the wake of the Fourth Industrial Revolution or the impact of ‘fintech’ on the financial sector.  Concurrently on the same dates and city, the Institute of International Finance (IIF) will be holding its annual meeting, focusing on the future of finance.

10 Oct 2017

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.”

29 Sep 2017

08 Sep 2017

For months, European authorities have been mulling over a crucial issue for the health of the financial sector: reducing the stock of non-performing assets that have been piling up in banks’ balance sheets during the years of financial crisis.  The creation of a bad European bank is one of the alternatives that are being considered to solve the problem.

29 Aug 2017

BBVA has participated in a public hearing in the European Parliament, organized by the Committee on Legal Affairs (JURI). The aim of the hearing was to allow stakeholders to share their insights into the directive’s insolvency proposal with the MEPs. BBVA was the only representative of the financial sector, a fact that attests to the bank’s relevance for EU institutions on these matters.

28 Aug 2017

Once more this year, the symposium of the most important central bankers in the world was held in Jackson Hole from August 24 to 26. Under scrutiny were Janet Yellen, the Chair of the U.S. Federal Reserve and Mario Draghi, President of the European Central Bank. Their words gave no indications of any changes with respect to the future of monetary policy.

27 Jul 2017

21 Jul 2017

Mario Draghi did not surprise anyone yesterday. As expected, the European Central Bank (ECB) unanimously decided to leave interest rates unchanged. He also did not announce any immediate changes to the asset purchase program. However, he did offer some clues as to the direction the ECB will follow after the summer.  As BBVA Research notes in its ECB Watch report, the discussion on gradually tapering QE (Quantitative Easing, the ECB´s asset purchase program) will take place in the fall – most likely in September.

20 Jul 2017

The Pacific Alliance, made up of Chile, Colombia, Mexico and Peru, is a regional economic and comercial powerhouse.  This area grows more than the average in Latin America. BBVA Research expects GDP growth of 1.6% and 2.3% in 2017 and 2018, respectively.  “The Pacific Alliance is a success story in integration.  And not by chance.  It shares an ambition and a set of values behind this policy, on how prosperity should be reached,” said Jose Manuel González-Páramo, executive director of BBVA in Santander.

30 Jun 2017

09 Jun 2017

26 May 2017

17 Mar 2017

10 Mar 2017

03 Mar 2017

BBVA Executive Chairman Francisco González expressed his commitment to Mexico during his visit to Mexico City, announcing new investments to move forward the transformation process at BBVA Bancomer. “We are going to invest $1.5 billion,” he said,  following a meeting with Mexican Minister of Finance and Public Credit, José Antonio Meade. The 5-year investment plan will help BBVA Bancomer to leverage technology and develop solutions for its customers.

16 Feb 2017