Uncertainty dominates global economic landscape

This last week has been marked by a growing global uncertainty, promoted mainly by the commercial policy of the United States and its international repercussions. This climate of tension was reflected in the publication of significant economic data, and sometimes contradictory, of the main economies.

It highlights the unexpected contraction of American GDP in the first quarter, a fact that, although influenced by specific factors related to the anticipation of tariffs, has generated concern.

In Europe, the data offered mixed signals: an surprising resilience in the growth of the GDP of the Eurozone contrasted with downward revisions of the forecasts and a persistent concern for the impact of commercial tensions, a concern reflected in the recent decrease in types of the European Central Bank (ECB).

Spain presented a notable divergence, with strong GDP growth that coexisted with a surprising increase in unemployment. At the global level, business confidence was diminished, as the PMI indexes reflected, and the political responses of economies such as China and Japan underlined the magnitude of the challenge raised by protectionism.

The financial markets showed volatility, reacting to macroeconomic data, news about commercial policy and expectations on the actions of central banks. The week showed how anticipation and uncertainty about protectionist policies can generate economic distortions and affect trust, even before their direct effects materialize, creating a complex environment.

Table 1: Published key indicators (April 28 to May 4, 2025)

(R) = Revised

Winds against global: the political uncertainty of the US and economic signals collide

The world economy sailed through turbulent waters during the week, dominated by the uncertainty generated by the commercial policies of the US administration. This uncertainty was amplified by the publication of key economic data in the United States, which offered a complex image and, sometimes, contradictory to the state of the world's largest economy.

The surprising contraction of GDP and its underground currents

The most shocking data of the week was the publication, April 30, of the preliminary estimate of the United States Gross Domestic Product (GDP) for the first quarter of 2025. Contrary to the expectations of a modest growth of 0.3%, the US economy contracted an annualized rate of 0.3%. This figure marked a sharp change with respect to the growth of 2.4% recorded in the fourth quarter of 2024 and supposed the first quarterly contraction since the beginning of 2022.

A detailed analysis of the GDP components reveals that the contraction was not due to a generalized collapse of the activity, but to very specific factors linked to the commercial context. The Office of Economic Analysis (BEA) and numerous analysts attributed the fall mainly to two factors: a drastic increase in imports and a decrease in public spending. Imports, which are subtracted from the calculation of GDP, shot (contributing with a fall of 4.83 percentage points to growth), a phenomenon interpreted as an accumulation of inventories by companies in advance of the entry into force of new and highest tariffs announced in early April. Simultaneously, federal government spending fell 5.1%, the greatest fall since the first quarter of 2022, led by a decrease in defense expense.

However, this weakness in the main figure of GDP contrasted significantly with the strength of private domestic demand. Real final sales to private domestic buyers (a measure that excludes the volatile changes in inventories and public spending, adding private consumption and private investment) in fact they slightly accelerated their growth to a robust 3.0% annualized, compared to 2.9% of the previous quarter. This indicator, often considered a more reliable barometer of the underlying health of the economy, was driven by private consumption that, although moderated its rhythm ( +1.8% vs +4.0% in T4), remained solid, and for a fixed business investment that showed a strong dynamism ( +7.8% according to some sources, +9.8% according to others).

This divergence between the main data of GDP and the strength of private demand underlines how political decisions and the anticipation of its effects can distort key economic indicators. The contraction of the GDP of the first quarter seems to be more a reflection of the business maneuvers in the face of tariff uncertainty (advancing imports) than an intrinsic weakness of demand in the United States during that period. This phenomenon illustrates the immediate and significant behavioral impact of commercial policy ads, generating volatility that complicates the interpretation of the real economic situation.

Labor market: resilient but losing impulse?

The US labor market sent mixed signals with the publication of the April 2 Employment Report on May 2. The economy added 177,000 non -agricultural jobs, a figure that exceeded the expectations of consensus (around 130,000) and remained close to the monthly average of the previous 12 months (152,000). However, this data represented a slowdown with respect to the figure of March, which was also reviewed down to +185,000 (from +228,000).

Even more significant were the downward reviews for February and March, which subtracted 58,000 jobs from previous estimates. This suggests that the impulse of the labor market in the previous months was less than what was initially thought. The unemployment rate remained stable at 4.2%, in line with forecasts.

As for salaries, average income per hour increased a modest 0.2% monthly and 3.8% year -on -year. This moderation in salary growth, together with the stability of unemployment and downward reviews, points to a gradual cooling of the labor market, moving away the fears of imminent overheating. Sectorial data showed strength in health, transport and storage, and financial activities, while federal public employment decreased. Previous data, such as March Jolts job offers, already showed a downward trend in vacancies.

This data set presents a nuanced panorama for the Federal Reserve (FED). While employment creation exceeded expectations, the general trend, considering reviews and salary moderation, is a gradual cooling. This probably reinforces the cautious position of the Fed, which must balance the current resilience with the potential risks of a future weakening derived from the impact of tariffs and general economic uncertainty. There seems to be no urgent need to act in any direction based solely on these labor data, supporting the "data -dependent" approach that the Fed has been pointing out.

Inflation is moderated before tariffs, but how long?

The March income and personal expenses report, published on April 30, brought encouraging news at the front of inflation, at least temporarily. The Personal Consumer Expenses Index (PCE), the Fed -preferred inflation measurement, increased a 2.6% year -on -year in March. This figure was a slowdown from 3.0% in February and fulfilled exactly the expectations of the market. In monthly terms, the underlying index remained flat (0.0%), slightly below the +0.1%forecast.

The general PCE index also showed moderation, with an interannual increase of 2.3% (compared to 2.5%/2.7% in February, although slightly above 2.2% planned) and a null monthly variation. This continuous moderation of the underlying inflation in March reinforced the ongoing disinflation narrative and offered a momentary respite.

However, this relief must be contextualized. March data are prior to the implementation of the most significant tariffs announced in April. There is a broad consensus among analysts that these commercial measures will exert a bullish pressure on prices in the coming months and quarters. The expected mechanisms are the direct increase in imports and the reduction of competitive pressure on national producers. In fact, the PMI data manufacturing overalls in April already showed an acceleration in prices charged by factories, partly attributed to tariffs. In addition, surveys such as that of the University of Michigan already reflected an increase in the expectations of household inflation in April, reaching levels not seen in decades.

Therefore, although March inflation data were positive, there is a considerable risk that this decline is transient. The possibility of a resurgence of inflation induced by tariffs later in 2025 or 2026 represents a significant challenge for monetary policy and economic perspectives.

Navigating uncertainty: the divergent trajectories of Europe and Spain

While the United States dealt with its own contradictory data, Europe and Spain presented their own complexities, showing a mixture of unexpected resilience and vulnerability to the growing global commercial tensions.

EUROZONA: Resilience of the first quarter against degraded perspectives

The Eurozone economy showed a surprising strength at the beginning of 2025. The preliminary estimation of GDP for the first quarter, published on April 30, revealed a 0.4% growth compared to the previous quarter. This figure not only exceeded expectations, but also represented an acceleration against the revised growth of 0.2% in the fourth quarter of 2024 (according to some sources) and 0.0% according to others.

However, this positive fact contrasted strongly with the pessimism that permeated the economic forecasts for the rest of the year. Numerous institutions, including the International Monetary Fund (IMF), ECB staff, Goldman Sachs and The Conference Board, reviewed their growth projections for the Eurozone in 2025, explicitly citing the expected negative impact of US tariffs and high uncertainty as the main factors. The ECB itself, in its decision to cut interest rates on April 17, had already pointed out the deterioration of growth prospects due to commercial tensions as a key justification. In an attempt to counteract these winds against and promote strategic autonomy, the European Union announced significant initiatives, including a plan of 200,000 million dollars to support the technological sector, with an approach to artificial intelligence, quantum and semiconductor computing.

This dichotomy between a good quarterly data and some shady forecasts raises a key question: does the growth of the first trimester reflect a genuine underlying fortress or is due, in part, to temporary factors such as the advancement of orders by the companies before the tariff threat? Some data from the April PMI suggested precisely this phenomenon of "Front-Loading". While the first quarter data are mostly prior to April ads, a certain effect of anticipation could have influenced. The fact that most forecasts point to a significant deceleration in the next quarters suggests that analysts believe that tariffs will have a considerable impact, questioning the sustainability of the impulse observed at the beginning of the year.

Inflation in the Eurozone: stable on the surface, underlying acceleration

The Eurozone inflation data for April, published on May 2 through the flash estimation of the harmonized consumer prices index (IPCA), offered a complex image. The year -on -year general inflation remained stable in 2.2%, without changes compared to March and slightly above the 2.1%consensus, but very close to the 2%target of the ECB.

The analysis of the components showed divergent dynamics. A more pronounced drop in energy prices (-3.5% year -on -year compared to -1.0% in March) was counteracted by an acceleration in the inflation of services, which rose to 3.9% from 3.5% in March, and a slight rebound in food inflation, alcohol and tobacco (3.0% vs. 2.9%). The prices of non -energy industrial goods remained stable (+0.6%).

Crucially, the underlying inflation (IPCA excluding energy, food, alcohol and tobacco) accelerated, rising to 2.7% year -on -year from the minimum of three years of 2.4% registered in March, and exceeding the provision of 2.5%. This rebound, driven by persistent inflation of services, presents a challenge for the ECB.

The Vice President of the ECB, Luis de Guindos, in an interview published on May 3, recognized the need to closely monitor the inflation of services and salary dynamics, although he maintained an optimistic tone about the final achievement of the 2%objective. The stability of general inflation is good news, but the acceleration of the underlying complicates decision making. Justify the recent types of types based on concerns about growth, but it makes argument difficult in favor of rapid additional cuts if underlying pressures persist. The ECB seems to be prioritizing the risks for growth derived from tariffs, accepting a somewhat more sticky underlying inflation in the short term, trusting that the expected salary moderation ends up cooling the prices of services. The situation tests the "data" approach to the ECB.

Spain: Strong growth collides with an increase in unemployment

Spain presented a particularly divergent painting during the week. On the one hand, the economy continued to show remarkable dynamism. The National Statistics Institute (INE) reported a 0.8% GDP growth in the first quarter compared to the previous quarter. Although BBVA Research estimated a slightly lower growth of 0.6%, qualifying it below their expectations, both figures placed Spain well above the eurozone average (+0.4%). This vigor was attributed to the continued strength of services exports (especially tourism) and domestic demand. The Bank of Spain and the IMF maintained relatively robust growth forecasts for the set of 2025, around 2.5%-2.7%.

However, this economic strength contrasted surprisingly with labor market data published on April 28. The unemployment rate corresponding to the first quarter of 2025 unexpectedly rose to 11.36%, from 10.61%of the previous quarter, exceeding the forecasts (around 10.7%) and reaching its highest level in a year. This increase was due to an increase of 193,700 unemployed people and an employment drop of 92,500 jobs. The loss of employment affected all sectors, being the most damaged services (+124,900 more unemployed).

Regarding inflation, April preliminary data showed a slight moderation in the general rate of the CPI to 2.2% year -on -year (from 2.3% in March), although slightly above 2.0% forecasts. However, the underlying inflation recaped to 2.4% year -on -year, from 2.0% in March.

The marked divergence between the strong growth of GDP and the increase in unemployment in the first quarter suggests the possibility of a dynamic of "recovery without employment" or the existence of structural problems in the Spanish labor market. It could indicate that growth is concentrated in less intensive sectors in labor or with high increases in productivity, or that friction persists that prevent efficient absorption of generated employment. BBVA Research also pointed to a decrease in the hours worked despite the increase in employment, which could indicate underemployment. This paradox questions the quality and inclusiveness of the Spanish economic expansion and deserves deeper scrutiny, despite the relatively optimistic growth forecasts of the IMF, which also warned about risks such as the weakness of investment and possible labor problems.

The great economies respond: strategic countermeasures of China and Japan

The intensification of commercial tensions promoted by the United States caused direct political responses by other major economies during the week, evidencing the perception of significant economic disruption.

China announced an integral economic plan for revitalizing its economy in the face of internal difficulties (weak domestic demand) and external (US tariffs). The plan included measures to stimulate domestic demand, develop the services sector, increase low and medium income income, and increase unemployment insurance payments. Crucially, the plan explicitly contemplated interventions to protect individuals and companies from the impact of US tariffs. Parallel reports even suggested the possibility that Beijing eliminated some of their own tariffs on American products, such as semiconductors, as a measure to counteract external shocks.

Similarly, Japan revealed a package of emergency economic measures to mitigate the negative effects of US tariffs. This package included support for business financing and consumption stimuli, such as reduction in gasoline and diesel prices, subsidies for energy invoices and the consideration of expanding low -interest loans for small businesses. Prime Minister Ishiba declared to be doing everything possible to alleviate the impact on key industries such as automotive and steel. These measures were announced in a context of weak economic data in Japan, especially persistently high inflation that complicates the task of the Bank of Japan. Precisely, the Bank of Japan kept their interest rates unchanged at 0.50% in its monetary policy meeting held during the week, in the midst of this complex economic situation and tariff concerns.

These proactive actions by China and Japan highlight the magnitude of economic disturbance that anticipate as a result of US commercial policies. Their stimulus and internal support packages represent attempts to isolate their external shock economies. This could lead to greater divergence in political trajectories globally, complicating international coordination, since each nation prioritizes internal stability against an increasingly uncertain and protectionist exterior environment.

Market pulse and geopolitical context

Global financial markets reflected dominant tension and uncertainty during the week. A notable volatility was observed, with a lower performance of US assets at the beginning of the month and in the previous weeks, even registering unusual sessions with simultaneous falls in the S&P 500, the bonds of the treasure and the US dollar. However, towards the end of the week and beginning that of April 28, there was a rebound, promoted in part by conciliatory comments of the Trump administration regarding the Fed and the negotiations with China. Indices such as Dow Jones and S&P 500 chained several upward sessions until Monday 28. The technological sector (Nasdaq) showed more mixed behavior, with great expectation for the business results of large companies.

In the currency market, the US dollar, after reaching minimum of three years the previous week, showed weakness towards the end of this week, losing land even after apparently positive employment data. On the contrary, the euro showed some relative strength. Oil prices experienced a remarkable fall during the month of April.

Market performance was clearly influenced by the interaction between key macroeconomic data (the negative surprise of the US GDP, the NFP employment data better than expected but with nuances), expectations on monetary policy and, above all, the changing perception of the risks associated with commercial policy. The weakness of the dollar despite some positive data could be interpreted as a sign that the markets were discounting a greater risk of recession in the US or anticipating a more accommodating response by the Fed in the medium term, influenced by the shock of the GDP and the general uncertainty.

All this was developed in a persistently tense geopolitical context. The strategic competition between the US and China, qualified by Blackrock as the most difficult situation since 1979, tensions in the Middle East (Israel-Hamas/Hezbollah conflict, huti attacks) and the prolonged war in Ukraine continued to be background factors that fed global uncertainty. This uncertainty was also reflected in the PMI data manufacturing global April, which showed a fall in export orders and a significant deterioration of business confidence worldwide, with explicit mentions of the impact of tariffs and protectionism.

Final analysis: navigating the fog of uncertainty

The first week of May 2025 closed leaving a complex global panorama and dominated by strong crossed currents. Although some indicators offered resilience signs - the NFP employment data in the US exceeded the forecasts, and the growth of the GDP of the first quarter both in the Eurozone and in Spain was robust - the predominant narrative was defined by the deep uncertainty derived from US commercial policy.

This uncertainty was manifested in various ways: it distorted key economic data such as American GDP through preventive accumulation of imports; caused a collapse of business confidence globally; He promoted reactive political responses in large Asian economies; and generated a notable volatility in financial markets. The divergences observed - between the main data of the US GDP and its underlying internal demand, or between the strong growth of Spain and the increase in unemployment - underlined the need for a nuanced analysis that goes beyond the superficial figures.

The central banks, especially the FED and the ECB, faced complex decisions, trying to balance the risks of a possible stagflation (combination of weak growth and inflation driven by tariffs) with the management of monetary policy in a volatile environment. The week showed that, in the current environment, political and geopolitical uncertainty, particularly in the commercial field, can temporarily eclipse the traditional economic foundations when directing the feeling of the market and generating short -term economic distortions. The difficulty in anticipating economic trajectories is magnified when unpredictable changes in politics become the dominant variable, demanding a cautious navigation by companies and investors.