Keeping your finger on the pulse of the global economy

Keeping pace with global economic developments can be tricky. There’s a skill in blocking out all of the noise, political and otherwise, and focusing on the bottom line fundamentals. So, what do you really need to know as winter approaches?

Over the last few months, a series of positive economic data has been released, however there are a number of potential issues that could act to restrain the pace of growth across the latter half of the year. The OECD composite leading indicator, which covers advanced economies plus China, India, Russia, Brazil, Indonesia and South Africa, has been in decline since peaking in January and slipped below trend in both May and June. This led the OECD to concede that its lead indicators are: “pointing tentatively to easing growth momentum“.


At the top of the ‘potential problem’ list is the continuing trade tensions between the US and the rest of the world, and the re-emergence of protectionist policies. Very closely followed by the prospect of a no-deal Brexit and the impact of monetary tightening in the form of interest rate rises, both of which also have the potential to precipitate a softening in global growth over the coming months.


Arguably the prime area of concern in relation to global economic growth prospects remains the threat of a full-blown trade war. Since Donald Trump was elected US President on a protectionist agenda nearly two years ago, the possibility is evident and still looms large.

During the summer months, the prospect of a no-deal Brexit does seem to have intensified, although the full ramifications are near impossible to predict, it would seem safe to assume that such a scenario will have negative economic consequences for the UK.

Despite the government suggestion that securing a deal is “the most likely outcome“, interestingly it recently started publishing a series of technical notices, intended to prepare businesses, citizens and public bodies for the possibility of a no-deal Brexit. This latest volume of literature rests alongside the 68 technical notices already produced by the EU on such an eventuality.

So, while no one is currently predicting the onset of a sharp slowdown or recession, and grounds for optimism remain in terms of future growth rates, there are signs that the global economy may be starting to lose a little momentum. The good news is, investment opportunities always exist.