Global Economy Briefing: January 7, 2026

Key Points

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• Europe’s inflation cooled again while services held above 50; Germany’s construction snapped back even as retail dipped.

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• U.S. services accelerated, but job openings fell and big fuel builds capped headline risk.

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• Asia stayed the ballast: India’s growth stayed high and China’s reserves rose. In Latin America, Chile’s copper-led surplus widened.

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United States

\nServices re-accelerated: ISM non-manufacturing 54.4 with activity 56.0, new orders 57.9, employment 52.0, prices 64.3.
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\nLabor demand cooled as JOLTS openings fell to 7.146 million and ADP rose 41k. Factory orders softened (−1.3% m/m; ex-transport −0.2%).
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\nMortgage rates hovered ~6.25–6.32%; applications swung (−10.0% then +0.3% w/w) with refis stabilizing and purchases softer.
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\nEnergy balanced the picture: crude −3.832M bbl; gasoline +7.702M; distillates +5.594M; imports +0.563M; Cushing +0.728M; utilization flat. Auto sales remained healthy (cars 2.77M; trucks 13.25M).
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\nNet: demand is service-led; goods are soft; product builds temper near-term inflation.
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Europe and UK

\nDisinflation deepened without a cliff. Eurozone CPI eased to 2.0% y/y (core 2.3%); both rose 0.2–0.3% m/m.
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\nDutch CPI was 2.8% y/y. France’s CPI/HICP ran 0.8%/0.7% y/y with confidence at 90. Italy’s CPI/HICP were 1.2% y/y (both +0.2% m/m); core CPI 2.3% y/y.
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\nGerman retail fell −0.6% m/m (+1.1% y/y), but construction PMI jumped to 50.3; unemployment rose only 3k (rate 6.3%).
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\nRegional Land CPIs eased (e.g., Bavaria 1.7% y/y). UK construction stayed weak (PMI 40.1) while households kept deleveraging (housing equity withdrawal −£10.9B). Auctions were orderly (UK 5-yr 3.980%; German 10-yr 2.830%; 2-yr Schatz 2.110%).
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\nMessage: prices cool, services carry growth, industry stabilizes unevenly.
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Asia-Pacific

\nIndia’s growth backdrop stayed strong (annual GDP 7.4). China’s FX reserves rose to $3.358T, reinforcing buffers.
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\nJapan cooled at the margin—services PMI 51.6; wage growth 0.5% y/y—while long yields edged higher (30-yr JGB 3.447%).
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\nAustralia’s external pulse softened (exports −2.9% m/m; surplus A$2.936B). New Zealand’s dairy auction rose 6.3%, lifting farm incomes.
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Latin America and Africa

\nChile’s surplus widened to $3.59B as exports reached $11.29B (copper $5.83B) against $7.69B of imports—supportive for the peso, revenues, and 2026 mining capex.
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\nBrazil’s November trade surplus was strong ($9.63B) but FX flows were negative (−$4.127B).
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\nMexico’s consumer confidence ticked up to 44.7. South Africa sold 48.98k vehicles in December (19.2% y/y) but below November’s level.
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What it means

\nLower European inflation and calm funding reduce global rate volatility. The U.S. remains two-speed—firmer services, softer goods—while big product builds cap headline risk.
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\nAsia’s buffers (India’s growth, China’s reserves) and Chile’s copper strength set a floor under the 2026 goods cycle without reigniting inflation.
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\nTilt: keep quality duration; overweight U.S. service/auto names; add euro exporters using dollar-priced inputs; prefer MXN over BRL until Brazil’s outflows ebb; in LATAM, Chile mining and Mexico domestic demand look best placed.

This is part of The Rio Times’ daily global economic intelligence for the Latin American financial community.

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