Monday Monitor: Global Economy Results

The global economy continued to expand in the first quarter, albeit at a more moderate pace. The persistence of low inflation should limit the extent of monetary policy tightening by major central banks this year, while fiscal policy is also expected to remain stimulative in both advanced and emerging economies. As such, we expect world GDP to match last year’s growth print of 3.8%, although that assumes world governments successfully manage risks posed by trade protectionism and record debt levels.

Global Economy Highlights include:

  • U.S. economy firmly on track to grow about 2.8% in 2018. Solid fundamentals suggests an acceleration of growth after Q1. But protectionist policies threaten to disrupt an otherwise promising economic outlook
  • Persistence of low inflation should limit the extent of monetary policy tightening by major central banks this year,
  • We expect world GDP to match last year’s growth print of 3.8%, although that assumes world governments successfully manage risks posed by trade protectionism and record debt levels
  • A weaker-than-expected start to the year prompts us to downgrade our 2018 forecast for Canadian GDP growth from 2.5% to 2.2% We have also pushed to July the timing of an expected interest rate hike from the Bank of Canada
  • For a detailed report from our Partners at National Bank Financial Economics HERE.