Banxico: A deeper than expected cutting cycle

Where does China stand following the trade war truce?

The trade agreement signed between China and the US on May 12, 2025 marks a notable de-escalation in the ongoing bilateral trade tensions. While the deal has generally been interpreted as a turning point, it may be more accurately characterized as a truce, which was needed to mitigate the huge economic costs embedded in the high tariffs.Under the terms of the agreement, tariffs imposed by the US on Chinese goods were reduced from the additional 145% to 30% for a 90-day period, while China’s tariffs on US goods were cut from 125% to 10%. China will also consider easing some non-tariff barriers,...

France, second highest public spendings in the euro area: where do the differences with the others come from?

In 2024, France had the second largest public spending in the euro area (after Finland), at 57.1% of GDP, after 56.9% in 2023 and compared to 55.3% in 2019, before the measures taken during the pandemic. Between 2014 and 2023, France was at the top of the ranking. However, the gap with Germany and Italy has been narrowing over the past 10 years, although this tightening mainly reflects an increase in the share of public spending in the GDP of these countries. According to the latest data published by Eurostat (available only until 2023), the gap in public spending between France and the oth...