In Europe, the economic landscape is marked by a stark contrast between regions. France is experiencing a temporary boost from the just-completed Paris Olympics, driving consumer spending, while Germany faces a grim economic outlook with near-zero growth expected in 2024. This stagnation in Germany, coupled with rising inflation in the UK, presents significant challenges for the eurozone. These regional disparities highlight the ongoing transatlantic growth gap, with the US outpacing Europe due to stronger domestic consumption and more aggressive fiscal policy support. This divergence has implications for industries, including those within the fashion value chain and renewable energy sectors, where growth opportunities may vary by region.

On the logistics and supply chain front, the ongoing volatility in container shipping, expected to persist until 2025, presents challenges for global trade, including sectors like African fashion and renewable energy where supply chain stability is crucial. The shift in US LTL freight to non-asset providers due to rising costs also reflects broader trends in cost management and efficiency. For businesses focused on innovation and industry partnerships, these developments underscore the need to adapt strategies to navigate a complex and evolving economic landscape, where regional dynamics and supply chain disruptions could significantly impact growth trajectories.

Weekly Highlights

• Europe’s growth lags U.S. as Germany remains the eurozone’s economic problem child
• UK post-pandemic growth higher than previously estimated, ONS says
• US jobless claims fall, easing market fears
• China-Europe freight train trips up 12% from Jan-Jul
• Germany’s exports fall for the second consecutive month
• 3PLs claiming LTL freight gains from US customers, carriers

Economic News

“In our assessment, a lot of this (market sell-off) has been down to position capitulation as a number of macro funds have been caught the wrong way around on a trade, and stops have been triggered, initially starting with FX and the Japanese yen.”

Mark Dowding, chief investment officer at BlueBay Asset Management

Fed Chair Powell says September interest rate cut could be ‘on the table’ as inflation cools

Federal Reserve Chair Jerome Powell on Wednesday set the stage for the central bank’s first rate cut in four years, citing greater progress toward lower inflation as well as a cooler job market that no longer threatens to overheat the economy… Read more

US hiring fell sharply in July, an unexpected setback for the economy stoking recession fears

The U.S. economy suffered an unexpected setback in July as hiring fell sharply and the unemployment rate rose for the fourth straight month with raised interest rates taking a toll on businesses and households… Read more

UK manufacturing recovery strengthens

The UK Purchasing Managers’ Index (PMI) for the manufacturing sector rose 52.1 in July, reaching an 18-month high, according to data released on Thursday. Growth in output and new orders strengthened in July and staffing levels rose for the first time since September 2022, financial services company S&P Global reported… Read more

Bank of England lowers its main interest rate by 0.25%, to 5%, its first cut in over 4 years

The Bank of England has cut interest rates for the first time since the onset of the COVID-19 pandemic in early 2020 as inflationary pressures in the economy have eased… Read more

China Factory Activity Shrinks for Third Month in Hit to Growth

China’s factory activity contracted for a third straight month in July, leaving the economy on a weak trajectory that’s frustrating Beijing’s efforts to sustain faster growth… Read more

China issues plan to boost household consumption

China has issued a set of directives aimed at boosting household consumption, a weakness weighing on growth in the world’s second-largest economy, with the plan targeting sectors including child and elder care, and food and beverage… Read more

Japan’s economy likely rebounded in Q2 on consumption pick-up: Reuters poll

Japan’s economy likely rebounded in the April-June period after shrinking in the previous quarter thanks to a pick-up in factory output and consumption, a Reuters poll showed, helping the central bank make the case for further interest rate hikes… Read more

Japan hikes interest rates for second time since 2007

Japan’s central bank has raised the cost of borrowing for only the second time in 17 years as it tries to normalise monetary policy in the world’s fourth largest economy… Read more

Eurozone growth lifts but Germany’s economy sees surprise fall

The eurozone’s GDP grew 0.3% in the second quarter of 2024, exceeding expectations, but Germany’s contracted by 0.1%, indicating economic struggles for the bloc’s largest economy… Read more

“The outperformance of the U.S. is largely due to strong private consumption and domestic investment. Fiscal policy support was higher in the U.S. than in other advanced economies, overall spending 25% of GDP.”

Thomas Obst, senior economist at the German Economic Institute in Cologne

Industry News

We have an urgency to decarbonize transportation, given the adverse impacts we are seeing from climate change, which are only going to intensify. We examine where hydrogen can play a role by looking at the energetics to help guide deployment along with other factors such as cost, fueling time, range and safety.”

Greg Keoleian, a senior author of the paper and co-director of U-M’s MI Hydrogen initiative

SNCF Réseau says rail freight capacity is on the rise

Rail freight capacity in France is projected to reach an average yearly growth of 11 per cent for the 2020-2025 period, the country’s infrastructure manager SNCF Réseau stated… Read more

3PLs claiming LTL freight gains from US customers, carriers

US shippers moving less-than-truckload (LTL) freight are not just giving more freight to large LTL carriers such as Saia and XPO — they’re shifting pallets to non-asset providers as LTL costs rise… Read more

Container shipping market volatility to persist until 2025

Lars Jensen, CEO of Vespucci Maritime, forecasts continued fluctuations in the container shipping freight markets until 2025. Despite the reopening of the Suez Canal, disruptions and elevated freight rates are likely to persist… Read more

Maersk CEO dismisses US recession fears, cites strong freight demand despite weaker Q2 financials

Maersk CEO Vincent Clerc has addressed concerns over a potential US recession, citing robust freight demand as evidence of economic stability… Read more

Germany’s exports fall for the second consecutive month

According to the Federal Statistical Office, German exports fell by 3.4 percent in June 2024 compared to May, after adjusting for calendar and seasonal variations. Compared to the same period last year, exports dropped by 4.4 percent… Read more

China Launches First Unmanned Freight Train: Innovations in Railway Technology

China has launched a new unmanned freight train equipped with an autonomous driving system, this is reported by the railway transport news portal Railway Supply… Read more

DP World to provide CO2-per-consignment data for road to rail freight switch

DP World has today announced it intends to accelerate its efforts to switch more cargo from road to rail for freight transport from the Port of Southampton by partnering with carbon software provider Pledge… Read more

China-Europe freight train trips up 12% from Jan-Jul

From January to July, a total of 11,403 trains were dispatched, up 12 percent year-on-year. The trains delivered 1.22 million TEU (20-foot equivalent unit) containers… Read more

Volumes and Freight Costs Surge as Retailers Accelerate U.S. Imports

Retailers are rushing to get inventories into the United States reports the National Retail Federation in part due to the fears of a U.S. East Coast dockworkers strike and to guard against the ongoing disruptions due to the diversions away from the Red Sea… Read more

LTL carriers haul more retail freight as industrial demand lags

LTL carriers are handling more than their typical share of retail freight as they confront stagnant industrial demand, several executives said in Q2 earnings calls… Read more

June sets record for China-US containers

Container traffic from China to North America set a monthly record in June as shippers looked to get ahead of supply chain disruptions closer to the holiday retail season… Read more

Euronav flags U.S. politics and China’s economy as risks to shipping momentum

Belgian oil tanker company Euronav expects global sea trade to increase this year, driven by the rerouting of Red Sea shipping, but said a change in the U.S. presidency and a slowdown in China’s economy are key risk factors… Read more

“ Retailers are concerned by the possibility of a strike at ports on the East and Gulf coasts because contract talks have stalled. Many retailers have taken precautions including earlier shipping and shifting cargo to West Coast ports.”

Jonathan Gold, NRF Vice President for Supply Chain and Customs Policy

Ranon Quote of the Week

“ If you’re in the freight buying business and seeking stability, you might need to reconsider your career path”

Lars Jensen, CEO of Vespucci Maritime

Technology, Policy and Sustainability Updates

Air Europa Cargo and cargo.one announce freight booking partnership

Air Europa Cargo and cargo.one have unveiled a global partnership that brings the Spanish carrier’s cargo capacity to cargo.one’s platform for digital air cargo bookings… Read more

Green hydrogen could power the future of passenger and freight transportation

Green hydrogen is emerging as an important potential solution for decarbonizing transportation, but new energy efficiency findings indicate that it should be used strategically in heavy-duty road, rail, aviation and marine transportation… Read more