Charting the Global Economy: US hiring slows, eurozone CPI cools

US hiring slowed sharply in June after three months of better-than-expected jobs reports, and investors scaled back bets on a Federal Reserve interest-rate increase this year.
Meantime, inflation in the euro zone fell by more than expected in June, as oil prices dropped to pre-war levels.

Over in Asia, Japan is close to its longest economic-growth streak since World War II, with demand for artificial intelligence-related products providing a key boost for exports.


Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy, markets and geopolitics:

US

The US labor market cooled down in June even as the unemployment rate fell, curbing some of the budding momentum in job growth this year. The pullback in hiring was led by the biggest decline in leisure and hospitality payrolls since 2020.

The US won’t renew the US-Mexico-Canada Agreement, or USMCA, choosing instead to conduct annual reviews of the pact in a decision that risks adding uncertainty for companies producing goods across North America.

The decision marked a head-spinning reversal for President Donald Trump, who had rammed through the original USMCA in 2020 and once called it the “best and most important trade deal ever made.”

Europe

Euro-area inflation eased more than anticipated as efforts toward peace in the Middle East sent global oil prices lower. Consumer prices rose 2.8% from a year ago in June, down from 3.2% the previous month, according to Eurostat. Policymakers urge caution, however, warning that the knock-on effects of higher oil and natural gas costs as fighting broke out will take time to be felt.

The European Union’s latest bid to reset its trade with China is already floundering, with some member states and officials involved in the planning skeptical that the bloc is ready to take decisive action should diplomacy fail. Leaders can’t yet agree on what tangible steps to take to fix a trade deficit that now exceeds €360 billion ($410 billion) or how to make domestic industries competitive against Chinese companies that rely on state subsidies, according to people familiar with the matter.

Asia

Japan is close to notching its longest economic growth streak since World War II, as the nation weathers higher oil prices from the war in Iran and the central bank’s ongoing quest to normalize interest rates.

Two of China’s best-known hedge fund managers are warning that the artificial intelligence boom in global stock markets has become an unsustainable bubble. Wealspring Asset said global AI stocks have become a “super bubble” and that the “collapse point may not be far away,” while Shanghai Banxia Investment Management Center said “the trigger for the AI bubble to burst has already appeared.”

Emerging Markets

Emerging-market stocks recorded the best quarter in 17 years, with gains in Asian artificial-intelligence shares helping markets weather the Iran war and higher oil prices.

Most of Venezuela’s defaulted bonds, and those issued by state-owned Petroleos de Venezuela SA, are tumbling as investors factor in a bleaker financial outlook after two devastating earthquakes added to the challenges of a sweeping debt restructuring.

World

Colombia and Tanzania hiked, while the Bank of Central African States cut its key rate. Jamaica, the Dominican Republic, Uruguay and Albania kept borrowing costs unchanged.