The US is enjoying a strong rebound after its weather-induced slowdown, the UK has extended its period of rapid growth into Q2 and the recovery in the euro-zone has gained momentum. On the other hand, activity in Japan seems to have slumped in April due to the consumption tax hike, and there is no sign that the period of slower growth in China is coming to an end. Meanwhile, global inflation remains very low and there is still likely to be a period of damagingly low inflation – or even outright deflation – in the eurozone. This environment should allow central banks to continue withdrawing policy stimulus only gradually in the US and to announce additional stimulus in Japan and the euro-zone during the coming months.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services