Blog | The economic shock caused by the war between the United States and Iran has quickly fed into euro area firms’ expectations. Daily responses to an ECB survey show an immediate increase in expected input costs, selling prices and short-term inflation. Firms' expectations for costs, prices and the broader macroeconomic environment are central to their decisions on wages, investment and employment. These decisions, in turn, determine how economic shocks are transmitted to the economy. When a major geopolitical event occurs,...

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Corrigendum: In the OECD GDP release published on 21 May 2026, the quarter-on-quarter growth for Italy in the first quarter of 2026 is 0.2%, and not 0.1% as initially published in the last sentence of the second paragraph. GDP (Gross Domestic Product) growth in the OECD area increased slightly to 0.4% in Q1 2026, up from 0.2% in the previous quarter, according to provisional estimates (Figure 1). This reflects a mixed picture across the 28 OECD countries for which data was...

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Blog | Governments can protect vulnerable households, keep businesses open, and preserve price signals without straining public finances. When global energy prices spike, governments face an unenviable dilemma: shield people and businesses while straining already reduced room in public budgets—or let prices rise for everyone and risk social and political backlash. So, how can policymakers do the best of both? To be sure, there is no one-size-fits-all response because the impact of the war in the Middle East differs widely across...

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Today, the Council presidency and the European Parliament reached a provisional agreement on two regulations aimed at implementing the tariff-related aspects of the EU-US Joint Statement, agreed on 21 August 2025. The agreement marks an important step in delivering on the commitments undertaken in the EU-US Joint Statement. It aims at enhancing a stable and predictable transatlantic trade relationship, while ensuring robust safeguards and preserving flexibility to be able to protect the EU’s economic interests, if needed. The Joint Statement is expected to serve as a platform to...

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Screening of investments to be mandatory for all member states in sensitive sectors such as defence, financial services and semiconductors New regulation is crucial to the EU's economic security Improved cooperation mechanism among Member States and harmonisation of procedures European Commission to set conditions on foreign investments On Tuesday, Parliament approved new EU rules for the screening of foreign investments to prevent security risks. With 508 votes in favour, 64 against and 90 abstentions, MEPs gave their green light to...

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The Commission published its fifth State of the Schengen report, reviewing developments in the Schengen area over the past year and setting priorities for the year ahead. The Schengen area continues to demonstrate resilience, underpinned by collective efforts at both EU and national level. The Schengen area is one of the European Union's most tangible and valued achievements, enabling a more than 450 million EU citizens to travel, work, study and live freely across borders while supporting trade, tourism and freedom of...

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