Despite significant headwinds, statistics released during the early stages of the year have revealed that the global economy has shown signs of resilience. Economists began upgrading growth forecasts as a result and the World Economic Forum’s latest Chief Economists Outlook has highlighted indicators of ‘nascent optimism.’
First quarter data has shown that the global economy performed better than most economists had expected, with growth recorded across all regions. Uncertainty continues to be a key feature, with pressure being exerted from a number of issues.
Inflationary pressures set to recede
For policymakers around the globe, tighter financial conditions and persistent inflationary pressures remain key challenges. While economists do expect inflation to fall over the rest of the year, this decline is predicted to be slower paced than previously anticipated.
‘Enabling resilient economic growth’
During the World Economic Forum’s recent Growth Summit, a key theme was ‘enabling resilient economic growth’ with conversations focusing on equitable globalisation and sustainable, inclusive growth. Their updated forecast highlighted a notable strengthening in growth expectations, although sharp regional variations are evident. With China’s reopening expected to drive a rebound, buoyant activity is predicted for Asia, while growth prospects are thought to be less robust in Europe.
An improving outlook should create opportunities for investors. The divergent regional dynamics and uncertain backdrop inevitably means asset, sector and geographic diversification will remain a vital component in any investor’s armoury, as will professional financial advice.
It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.