Economic Forecasts from the World's Leading Economists

Robust domestic demand leads global growth in Q2

Global growth remained strong in the second quarter despite rising trade tensions, higher oil prices and increased volatility in the financial markets. Tightening labor markets, robust investment in key global economies and still-accommodative financial conditions propelled economic activity in Q2. Moreover, despite signs of having peaked in Q1, global trade remained relatively robust in Q2. A comprehensive GDP growth estimate for the global economy put year-on-year growth at 3.4% in Q2. While the print was a notch below last month’s preliminary estimate of a 3.5% rise, it matched the result from the previous period.

 Recovery stays on track in Q2 but headwinds to growth mount in Q3

Preliminary data revealed that growth held up in Latin America’s economy in the second quarter, despite global geopolitical uncertainty and political tensions in key economies. Regional GDP (excluding Venezuela) grew 1.9% over the same period last year in Q2, matching Q1’s result. Tailwinds from higher commodity prices, recovering private consumption and a solid global economy supported growth in the quarter. However, growth was uneven across countries and activity in the more vulnerable economies of Argentina and Brazil floundered.    

Regional economy performs well in the second quarter

Available data suggests that the economy of Central America and the Caribbean firmed up in the second quarter of the year, riding on the coattails of strong economic growth in the U.S., which is buoying exports, tourism and remittances in the region. A preliminary estimate by FocusEconomics suggests that CENAM grew 2.4% in Q2, which is up 0.1 percentage points from last month’s figure and above growth of 1.9% in the first quarter. Excluding Puerto Rico—which is still mired in a recession intensified by the damage caused by last year’s hurricanes—regional GDP growth would have reached 4.0% in the second quarter, from 3.4% in Q1.

 Growth slows in Q2, further moderation likely in third quarter

A comprehensive estimate of GDP growth for ASEAN suggests that the region’s economy lost momentum in the second quarter as several countries saw their external sectors weaken. GDP is estimated to have expanded 5.2% in Q2 on an annual basis, matching the preliminary estimate but below the previous quarter’s 5.4% figure.

Financial volatility and geopolitical risks will likely weigh on growth in Q3

More complete data for the second quarter corroborates that the East and South Asian (ESA) economies continued to expand robustly. Domestic demand remained strong mainly due to resilient private consumption. Tight labor markets, accommodative financial conditions and low inflation boosted household spending in Q2. Moreover, despite early signs suggesting that global trade peaked in Q1, the region’s external sector remained relatively robust in Q2. A preliminary GDP growth estimate for the region shows that ESA countries expanded an aggregated 6.3% year-on-year in Q2. While the print was a notch below the 6.4% increase in Q1, it matched last month’s forecast.

Growth stays lackluster in Q2

Preliminary data revealed that the Eurozone’s soft momentum at the start of the year carried over into the second quarter. GDP expanded a seasonally-adjusted 0.4% over the previous period in Q2, matching the first quarter’s reading and below the vigorous 0.7% growth seen throughout most of 2017. While the details behind the reading have not yet been released, the sluggish pace was likely driven by weak exports and subdued domestic demand amid lower confidence, higher inflation and reduced global trade. That said, the growth rate was still healthy overall and the economy’s fundamentals remain solid, reflected by an improving labor market and sentiment still high.

CEE economy grows solidly in Q2

Preliminary data revealed that the Central and Eastern European (CEE) economy grew robustly in the second quarter of the year, although the pace of expansion continued to slow after peaking in Q3 2017. Regional GDP expanded a healthy 4.2% annually in Q2, down modestly from Q1’s 4.4%. Tight labor markets, accommodative monetary policy and greater absorption of EU-linked funds are fueling a hot domestic economy; however, growth continued to wane after a stellar 2017 amid labor shortages and slower growth in major-trading partner, the Eurozone.

Economic growth ebbs in Q2, currency crisis in Turkey threatens outlook

Growth stays solid in Q2 on firm commodity prices

Recent data for the economy of the Commonwealth of Independent States (CIS) suggests that the regional recovery remained on track in the second quarter. Regional GDP is expected to have grown 2.0% year-on-year in Q2, unchanged from Q1’s expansion. Tailwinds from higher commodity prices, an improving labor market, low inflation and rising remittances are expected to have fueled activity in the region. However, overall regional growth is still moderate and remains far below the level prior to the commodity price slump in 2014.  

Growth picks up in Q2 but risks to the outlook loom on the horizon

Economic growth gained traction in the second quarter as higher oil prices and rising crude oil production boosted economic activity among oil-exporting countries. Conversely, higher crude prices appear to have eroded consumer’s purchasing power among oil-importing economies, while the ongoing monetary tightening by the U.S. Federal Reserve unnerved financial markets in the quarter. According to a preliminary estimate by FocusEconomics, the MENA economy rose an aggregated 2.6% year-on-year in Q2, which marked an improvement over Q1’s 2.5% expansion but was below the 2.8% expansion projected last month. The downward revision mostly reflected deteriorating economic conditions in Iran ahead of the U.S. economic sanctions scheduled for August and November.

Growth picks up in Q2 thanks to favorable global backdrop

Incoming data suggests that Sub-Saharan Africa’s (SSA) economy accelerated for the third consecutive quarter in Q2, as the region gains traction after the growth slump driven by low commodity prices. Regional GDP is projected to have expanded 3.3% year-on-year in the second quarter, which would mark the fastest growth rate since Q1 2015 if confirmed (Q2: +3.0% year-on-year). A supportive external environment likely boosted the recovery, thanks to higher commodity prices and healthy global demand. However, growth dynamics have been far from uniform across economies in the region, with some countries still experiencing lackluster activity.