Saarah Ghazi 
The economy slowed following the strong gains in the second half of last year, as it settled into a more sustainable growth pace. However, our business cycle indicator shows that growth improved midway through the second quarter and corroborates our expectations for Q2 GDP to rise about 2% at an annualized rate.
Over the last three decades, new data centre construction has surged and there are no signs that growth will abate in coming years as data collection, analysis, and storage needs are set to grow.
The recent increase in the unemployment rate is less threatening than it appears as it is limited in scope across age cohorts and industries, reducing the odds that a negative reinforcing cycle of unemployment, income loss, and job losses takes hold.
Contingency planning for possible disruptions caused by rising geopolitical tensions is becoming an increasingly important factor in business strategy planning. To this end, we have developed a globally consistent framework showing cross-country GDP vulnerabilities to an escalation in China-Taiwan tensions, focused on disruption to the global semiconductor supply chain.
Join Andrew Goodwin, Chief UK Economist, as he outlines the potential economic impact on fiscal policy of the manifestos published recently by the Conservative and Labour parties.
Recession fears are overdone and premature. The economic data has generally come in weaker than expected, but this is not the first time, nor will it be the last, that this occurs without the economy falling into a recession.
We still anticipate a shallow economic downturn in Q2 and Q3 before a tepid recovery emerges later this year. Accordingly, we nudged up our GDP growth forecast by 0.1ppt to 0.2% in 2024 and lowered our forecast by 0.1ppt to 1.9% in 2025.
In this week’s Beyond the Headlines, join Andrew Goodwin, Chief UK Economist, as he outlines how we’ve changed our UK interest rate forecast after a busy week for the UK economy.
The strength of the US dollar looks likely to continue this year and into 2025 before possibly waning in 2026, according to our analysis. Relatively robust US growth, favourable interest rate differentials, and structural improvements to the US balance of payments are all dollar positives.
We subjectively assign a greater probability of a divided government after the 2024 elections rather than one that is fully controlled by Republicans or Democrats. After considering the prospects for policymaking under a Republican trifecta, we modeled the macroeconomic impact of a divided government with either of the two leading presidential candidates at the helm.
UK prime minister Rishi Sunak has announced that a general election will take place on July 4. While there are likely to be some differences in manifesto tax and spending pledges, the poor fiscal inheritance and apparent reluctance of either party to materially alter the flawed fiscal rules suggest the election outcome is unlikely to significantly affect the near-term outlook.
We see signs of an industrial recovery in the eurozone which bodes well for eurozone EPS growth and supports our recent upgrade of the region to overweight. Energy intensive sectors look well placed to outperform as they trade on very depressed valuations and should benefit from the industrial upturn.
In January 2024, Fujitsu commissioned Oxford Economics to survey 800 CxOs from 15 countries to understand the impact of new technology, with specific focus on sustainability transformation.
The minutes from the April 30-May 1 meeting of the Federal Open Market Committee were uneventful, which is not surprising as they reiterate the recent communication from Federal Reserve officials. Therefore, they do not warrant a change to our baseline forecast or subjective odds around the near-term path of monetary policy.
Despite inflation and interest rates at levels unseen in three decades, industries continue to invest heavily in software fueled by its ability to improve an industry’s productivity and financial performance. In our latest Techonomics Talks, join Victoria Tribone, Economist and Data Scientist, as she examines the connection between software investment and productivity growth.
Our society and economy are deeply intertwined with nature, but human activity has pushed nature into crisis—one-third of the world’s forests are gone, the rate of species extinctions is accelerating, and scientists have issued stark warnings about the rapidly declining health of ecosystems. At the heart of this crisis is a profound irony: we are jeopardising the very systems upon which our life depends.
Our business cycle indicator confirms the economy has improved after getting off to a slow start in Q1. We expect the index to show an increase this quarter as consumer spending is on solid footing, the labor market remains tight, and business investment is decent.
In recent years, UK government figures have pointed towards a long-term decline in bee populations, and perhaps more worryingly, a study in the US found a decline in the honey yield per colony due to environmental degradation. Given this concerning evidence, World Bee Day was established by the UN General Assembly in 2017 to highlight the important role bees and other pollinators play in global food production, and how vital it is that we support them.
In this month’s Canada Up Close, Cassidy Rheaume, Associate Economist, discusses why we expect lower house prices and falling mortgage rates will help slow headline CPI inflation in Canada.
Employment is a fundamental part of life for many and directly links to their overall feelings of satisfaction and happiness. Recent studies, such as the comprehensive research conducted by the International Labour Organization (ILO), consistently highlight the positive association between employment and subjective wellbeing—the latter being how people evaluate their own lives.
