The world’s economic and financial leaders at this month’s IMF/World Bank meeting will preside over a strengthening global economy. Real GDP will be stronger next year than this. But the reasons differ by region.
Japan’s economic recovery is being driven by massive wage growth (which I measure by combining new jobs and pay increases) and super-easy monetary conditions (judged by interest rates and the exchange rate), but is being hindered by restrictive fiscal policy.
The US has enough consumer wealth and jobs to keep its economy on the boil, and the Fed has remained neutral on interest rate policy – up to now.
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