toretax.blogg.se - The us has a goldilocks economy

Many analysts have characterised the current configuration of healthy growth, low inflation, and easy financial conditions as a Goldilocks scenario: a global economy that is chugging along, not too hot, not too cold.

This benign inflation environment provides the runway for very gradual monetary policy tightening and credit conditions remaining accommodative for longer.

But the slowdown is likely to be measured and the risk of a "hard landing" has narrowed.Ī Goldilocks economy but three grumpy bears may not be far awayĪ striking feature of the global economy is how subdued inflation has been despite broad-based economic expansion and highly accommodative monetary policies.

The government is expected to rein in local government spending, tighten curbs on residential property purchases, and seek to reduce excess industrial capacity.

Emerging Asia is benefiting from the pick-up in the global electronics cycle, recovery in commodity prices, steady domestic demand, and benign financial conditions.Ĭhina is likely to see a moderation in growth this year but not cool off sharply.

The Japanese economy has recorded the longest growth streak in 16 years, with a resurgence in exports and investment.Įmerging market economies - especially in Asia - are benefitting from the positive spill-overs from the advanced economies as well as healthier macro fundamentals.

There is still slack in the economy, suggesting that the growth momentum is likely to be sustained. The Eurozone economy was probably the most pleasant surprise of 2017, with a strong recovery in household spending and private investment.The US economy is expected to grow at or above trend, driven by strength in consumption, a healthy labour market, and better prospects for business fixed investment with the enactment of the tax reform package.The advanced economies are leading the charge. The broad-based, geographical spread of the current economic expansion is perhaps the strongest basis for its durability. This reflects both a cyclical upturn as well as a structural uptrend, as products ranging from smartphones to automobiles and home electronics become increasingly chip-intensive.Semiconductor exports surged by 20% in 2017.The global electronics sector is on a strong upswing. The industry trends underlying the pick-up in trade are encouraging. This has arrested a worrying trend since 2011, with global trade growing slower than global GDP.Growth in global trade has almost doubled to 4% in 2017, outpacing world GDP growth.

Global fixed investments have rebounded by almost 6% in 2017, after contracting in the previous two years.Investment expenditure, which had been largely missing from the GDP growth numbers since the global financial crisis, is coming back.The IMF expects growth in 2018 to be even better than 2017.Most of the world's major economies are expected to continue strengthening over the course of this year.This is the strongest pace of expansion since the rebound from the global financial crisis in 2010.Īll indications are that 2018 will be another good year.World GDP is estimated to have grown by 3.8%, significantly higher than the 3.2% registered in 2016.Global growth about as good as it getsĢ017 has been a good year for the global economy. And also thank UBS for the invitation to speak at this conference. Mr Edmund Koh, UBS Head of Wealth Management Asia-Pacific,