Europe’s economy has outshone that of the United States in the past few weeks, as reflected in the two regions’ economic surprise indicators.
Why is that?
A combination of factors has led Europe to outperform: a mild winter, which has improved the energy situation; fiscal stimulus packages; and the reopening of China’s economy. The upshot has been a spectacular rally in European stocks. Since 31 August 2022, they are up 17.5% more than their US counterparts, and 23.5% if you factor in the euro’s appreciation against the dollar1. Read more >