US inflation moderates: “The important thing is the trend”

This week the US CPI data was released, showing a moderation of one tenth compared to the previous month, coming in at 3.3%. This figure was better than the expected rate of 3.4%, the same level in April, after several months of surprising highs. "Another surprise of this nature would have been problematic, although a single data point doesn’t tell a complete story in itself. The important thing is the trend, and what we’re seeing is that inflation is resistant to falling," says Alberto Matellán, chief economist at MAPFRE Inversión.

This publication coincided with the meeting of the US Federal Reserve, although the chief economist doesn’t believe that this data has biased the speech of the central bank’s chairman, Jerome Powell. However, Matellán insists that macro figures don’t justify rate reductions.

In the stock markets, investors are watching Apple, which has announced that its new iOS 18 will feature artificial intelligence. Matellán points out that the degree of expectation regarding AI is so high that it’s “starting to be over the top,” although Apple's rise is justified from the point of view of earnings and the growth it’s experiencing. Given the high valuations of the US Stock Exchange, European stocks could gain in attractiveness for some investors.

"The macro situation seems to be improving if we look at the readings of the leading indicators that we’ve seen in recent weeks. Valuations are based on relatively low levels, and we may see higher-than-expected growth in business earnings at the beginning of the year. But it still seems to me that this growth in profits isn’t sufficient to exceed what we can expect from the United States, where, in addition, due to the mix of companies listed there, deserve a higher valuation premium," says Ismael García Puente, head of investment and fund selection at MAPFRE Gestión Patrimonial.

Improved growth forecasts for Spain

The Bank of Spain has improved its growth forecasts for Spain to 2.3% and maintained its growth forecasts for 2025 at 1.9%. “Everything points to more accelerated growth in Spain and Europe,” Matellán points out, although he adds that we’ll have to wait and see how this strengthening will affect the European Central Bank’s road map.

The forecasts aren’t the same in every European country, however. In France, the growth forecast for this year is only 0.7%. "France is currently dealing with many challenges: a continuous loss of productivity, a loss of economic protagonism," Matellán noted. MAPFRE’s chief economist adds that, in addition, France is facing a sociopolitical challenge, especially after the French President, Emmanuel Macron, dissolved the Assembly and called a snap election.