As Spring 2025 unfolds, Europe finds itself at a potential turning point. Following prolonged stagnation and inflationary pressure, and amid a backdrop of escalating tariff tensions, a cautiously optimistic tone is beginning to emerge across macroeconomic indicators, financial markets and investor sentiment. This note brings together developments across key areas — economic data, inflation dynamics, market behaviour and geopolitical risk — to provide a coherent snapshot of Europe’s evolving outlook. Refresh this chart in your browser | Edit the chart in Datastream Euro area economies are gradually emerging from the stagnation that defined much of 2024. Recent improvements in industrial production and

Over the past decade the trend of hyper-globalisation, which has been one of the defining characteristics of economic growth, has started to wane. More recent changes to the global political climate have further threatened free trade, with the Trump administration is looking set to drive into place a slew of protectionist measures. In light of this backdrop, two other global economic powers, India and the European Union (EU), are increasingly keen to finalise a free-trade agreement (FTA) by the end of the year. It is clear to see why both parties are keen to engage in a free-trade agreement, with

The list lengthens as President Trump reiterated his intent for India to join the likes of Canada and Mexico, with plans to raise US tariffs by 2 April. India has traditionally been more of a closed economy and maintained tariff rates above global norms, imposing a mean average 14.36% rate in 2022 — much higher than the average tariff imposed by the US of 2.7%. Mr Trump aims to address this imbalance. Refresh this chart in your browser | Edit the chart in Datastream India is forecast, by the IMF, to become the world’s third largest economy by 2028 (when measured at

More than three years have passed since the outbreak of war between Ukraine and Russia. However, following the inauguration of Donald Trump in January, and subsequent dialogue between the United States and Russia, there has been talk of a potential peace settlement. But the recent meeting between Mr Trump and Ukrainian’s president, Volodymyr Zelensky did not go well, leading to uncertainty regarding the continuation of US military and financial support for Ukraine. Europe has stated its intention to step up its assistance in response, but what that may look like remains unclear. A peace deal still seems to be the

Over a month has passed since Donald Trump was inaugurated in Washington DC. In that time, he has moved swiftly to start implementing several of his promised policies, including preparations to impose broad tariffs, reductions in the federal workforce and the initiation of peace talks regarding the war in Ukraine. While the long-term effects of these actions remain uncertain, key trends in financial markets have already begun to reveal how investors are reacting to his policy decisions. The US dollar surged following Trump’s election victory on 5 November last year, reaching its peak in early January. However, since his inauguration

Germany’s snap election on Sunday, 23 February, has come against a backdrop of economic malaise in Europe’s largest economy. Patience with the incumbent Chancellor, Olaf Scholz, of the Social Democratic Party, had grown thin after two consecutive years of negative GDP growth. Mr Scholz said his hands had been tied by the German ‘debt brake’, a rule inserted into the German constitution by Angela Merkel in 2009 which limits the annual deficit of the federal government to 0.35% of GDP. But Mr Scholz’s political rival Friedrich Merz, the leader of Mrs Merkel’s former party the Christian Democratic Union and Christian

An ageing population, declining bang-for-investment-buck and a US determined to stymie China’s rise has Asia’s greatest powerhouse facing what looks to be a long decline. Since the global financial crisis, real estate construction and investment has been the Chinese government’s favoured economic fallback. This has allowed them to paper over cracks in local government finances, keeping employment high, albeit unproductive, and therefore limiting the risk of social unrest while supporting economic activity. Refresh this chart in your browser | Edit the chart in Datastream However, with investment having far outpaced demand, this has led to a buildup of massive imbalances in the

Economists will often borrow theories and techniques, devised by other disciplines, to better advance their understanding of the world. One clear example of this is the so-called ‘gravity model of trade’. As physicists will tell you, Newton’s law of universal gravitation states that the gravitational pull exerted between two objects is proportional to the mass of each object, and it is inversely proportional to the distance between them. In turns out that something similar is true regarding the flow of global trade — the larger two economies are, and the shorter the distance between them, the more they tend to

Similar to events in France and Germany, Canada also faces political upheaval, and reached a tipping point with the resignation of finance and deputy prime minister, Chrystia Freeland, on 16 December 2024. Shortly after, on 6 January 2025, Prime Minister of Canada for over nine years, Mr Trudeau, announced his intention to resign as Prime Minister and Liberal Party leader. He also announced the suspension of parliament until March, while the Liberal Party decides on its next leader. The next Canadian federal election is due by 20 October 2025 and will probably occur earlier as a vote of no confidence

Donald Trump was inaugurated this week, being officially given the keys to the White House for a second time. So far, there is little sign that distinguishing between posture and policy will be any easier this time around. Nonetheless, the first few days of his administration have provided some additional clarity. Most notably, perhaps, was a more dovish approach to tariffs. Meanwhile, the prominent role of Big Tech CEOs at the inauguration highlighted the likely importance his administration will place on AI, specifically, and economic growth, more broadly. The bigger picture is that the probable outcome of Trump 2.0 remains

In the UK, the Bank of England’s (BoE) stance on monetary policy and the future path for interest rates have been hot topics since the beginning of the year, and for good reason. Opposing forces, of both stagnating economic growth and stubborn inflation, are expected to have an impact on UK interest rate decisions in 2025. However, on the whole, Fathom does not expect interest rates to reduce much, with just one cut forecast over the course of 2025. Refresh this chart in your browser | Edit the chart in Datastream Stagnating economic growth has been a recurrent issue for the UK

It has been ten years since the People’s Republic of China launched its ‘Made in China 2025’ initiative — a decade-long plan to make China dominant in high-tech manufacturing across a range of sectors — including IT, new energy and robotics. To the best of our knowledge, Fathom’s recently updated RiCArdo dataset is the only existing dataset designed specifically to assess China’s progress in the sectors targeted by the plan. It shows that MIC-related sectors combined accounted for 18.8% of China’s total goods exports in 2023, up from 15.6% when the plan was first announced. Refresh this chart in your