Major Economies & Global Update
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The World
Global growth is set to ease this year, due largely to weaker momentum in developed economies and China. However, tight labor markets and more accommodative monetary policy should provide some support. A further escalation of trade tensions, particularly between the U.S. and China, is the key downside risk.
United States
While economic growth seems set to ease in H2, with a weaker global outlook and the ongoing U.S.-China trade dispute weighing on business investment, manufacturing and exports, resilient consumer spending and lower borrowing costs should cushion any slowdown. The key downside risks stem from a prolonged trade row and high corporate debt.
United Kingdom
Underlying momentum is likely to be meek in H2, held back by soft business investment and weaker growth in key trading partners. However, higher wages and a more expansionary fiscal stance should prop up activity, while inventory changes as firms prepare for a no-deal will likely distort GDP figures. The highly uncertain outcome of Brexit remains the key risk to the outlook.
Europe
Growth is seen slowing sharply this year due to lingering weakness in the industrial sector, a less favorable global backdrop and as geopolitical concerns hamper investment and exports. Risks to the outlook remain elevated and include rising global protectionism, slower-than-expected growth in China, a hard Brexit and other political concerns.
Japan
The domestic economy is expected to drive economic growth this year due to a relatively healthy job market, construction works related to the 2020 Tokyo Olympics and solid investment. Subdued global demand, however, is hurting Japan’s all-important external sector. Supplementary public spending should limit the negative spillovers of the October sales tax hike
Thank you Focus-Economics
September Major Economies Forecast
Cartoon by Dale Cummings, represented by Cagle Cartoons
Cagle Cartoons
