Global growth appears to have softened at the beginning of the fourth quarter. The stagnation in the euro-zone has continued and Japan has still not recovered from the effects of April’s consumption tax hike. Nonetheless, business surveys for October suggest that growth in the world as a whole remains relatively strong by past standards.
Looking forward, monetary policy is likely to continue to diverge. While the Fed has now ended its asset purchases, the Bank of Japan has stepped up its own quantitative easing. And we suspect that it is only a matter of time before the ECB too unveils a “full blown” programme of QE.
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