Today's financial news

Monday 7th August

<- Back to news

Germany's economy is in crisis, whilst it looks a lot brighter in the US

Play audio

Crisis hits German economy

Europe's largest economy, Germany, is showing signs of an economic crisis. The country was in recession over the winter, and GDP growth stagnated in the latest quarter. Due to the new geopolitical landscape, the country no longer has the opportunity to buy cheap energy from Russia, as exports to Russia have been suspended, and trade with China has come to a standstill. These problems can have a considerable impact on the country's economy and potentially affect the rest of Europe.

New figures in the USA

On Friday, the new job report for July was released in the USA. It showed that 187,000 new jobs were created. Although this is a good growth, it was less than the expectation of 200,000 jobs. However, 187,000 is still a relatively high value, especially considering the numerous interest rate hikes. The report also revealed a slight decline in unemployment, from 3.6% to 3.5%. There was also an increase in wages, growing by 4.4% on an annual basis and more than the expected 4.2%.

Status on earnings season

422 of the companies in America's S&P 500 index have released their financial results, with the accounting season having performed "better than feared" as many defied widespread fears of a slowdown before the accounting season. Now the question is whether the long-awaited economic slowdown has started to affect earnings, and whether the American companies can live up to the previously announced expectations. According to Refinitiv, as many as 79% of the companies have exceeded the analysts' estimates. Usually in a typical season, only two-thirds (corresponding to 66%) of the companies exceed analysts' expectations.

Sources:, Euroinvestor

Maria Collinge