The Day at a Glance | June 30 2021

The Top

*Inflation in Europe drops to 1.9% annually in June (0.9% underlying).

*The Chinese economy decelerated less than expected in June.

*ADP recorded 692 thousand new jobs in the US private sector during June (vs 600 thousand e.).

*The pandemic will cost the tourism sector 4.2 billion dollars at a global level: UNCTAD.

Economic environment

The European block`s rate of inflation decelerated during June. Europe`s most recent inflationary figures show a deceleration in consumer prices by setting at a 1.9% annual rate in June. Among the main economies, Germany (2.1%) and Spain (2.4%) are some that have recorded the highest rates of inflation in the last 12 months, but the block`s overall figure decelerated from the 2% recorded in May. Underlying inflation set at 0.9% and backs a scenario of inflation once again decelerating in July (due to a discounts season), however, could record an upwards trend starting in August and the second half of the year as prices among services recover and disruptions in productive chains maintain pressures on prices.

PMI`s for the Chinese economy confirmed deceleration in June. The manufacturing sector in China recorded deceleration during the month (50.9 June vs 51 May), something that suggests that the momentum has been lost in the exporting sector, due to some disruptions in the Shenzhen ports, scarcity of semiconductors, disruptions in the electric grid and pauses in production during inspections prior to the Communist Party`s 100-year celebration. There was also deceleration in the services sector (53.5 June vs 55.2 May), which was related to regional outbreaks of the virus that prevented people from traveling and affected accommodation businesses. The economy expanded at its most moderate rate since February of this year (Composite PMI 52.9 June) and the data points towards a generalized moderation in growth during the 2Q21.