Recessionary vibes are out today in Europe with today’s German inflation data coming out sticky with electricity prices, especially in gas propping up inflation higher than expected in various regions. Meanwhile, Italian industrial production continues to slow significantly once again. Other inflation statistics all show that in general, inflation in Europe remains sticky such as in Italy and Spain.
Malta’s rate of inflation is still slowing but remains high, and Malta’s inflation rate is also subdued due to electricity subsidies. However, Malta has had the lowest increase in its minimum wage in the EU as inflation soared. Notably, food prices in Malta have soared by 10% since last year and are still soaring, but people, in general, say the effects are harsher. The European growth rate is poor.
Europe is being affected by China’s deep economic slowdown, but this was expected due to the fact that China is by now a semi-developed economy. After going through its lift-off stage and becoming semi-developed, it is to be expected that China is not going to enjoy its previous exponential growth rates for the years to come. European leaders made a gross error of judgment in desperately trying to build economic ties with China when instead, such efforts should have been made more concerted and towards India.
GDP growth rate in the US is still relatively strong compared to Europe. Europe lags behind the US in economic growth and is comparably bestowed with deep energy inefficiency that is harming its overall economic prospects.