Portfolio Adviser - PA May 2019
Economic Summary
2019-05-26 07:49:24
United Kingdom
● Brexit has resulted in shrinking investment, a looming labour market shock and poor productivity in the UK, according to Goldman Sachs.
● The National Institute of Economic and Social Research said Britain’s growth rate would bounce back above 1.5% next year as ministers exceed existing public spending budgets to cope with an ageing population.
● UK inflation remained unexpectedly below target at 1.9% for the third month in a row in March, according to the Office for National Statistics.
European Union
● The inflation figure in the European Union was 1.6% in March, according to the union’s statistical office.
● Italian gross domestic product fell by 0.1% in each of the last two quarters of 2018, putting the economy in a shallow recession.
Asia Pacific
● Economic growth in East Asia and the Pacific is projected at 6% between 2019 and 2020, down from 6.3% in 2018, reflecting global headwinds and a slowdown in China, according to the World Bank.
● Thailand’s economic growth rate is expected to be slower than the regional average at 3.8% this year and 3.9% next year, down from 4.1% in 2018, according to the World Bank.
● Early estimates for the Indonesian election show president Joko Widodo will be re-elected.
United States
● Gross domestic product rose by 3.2% during the first three months of the year, according to the US Department of Commerce.
● Consumer spending growth slowed to 1.2% in Q1, from 2.5% in Q4 2018, while business spending on equipment grew by 0.2%, the weakest growth since autumn 2016.
Bric
● Brazil analysts cut their 2019 growth forecasts to the lowest level ever as investor pessimism in Latin America’s largest economy grew.
● Surging global oil prices will pose a big challenge to India’s new government. Domestic prices have been allowed to wane, so consumers are in for a painful surge as they catch up, according to Reuters.
● Brazil’s economy is expected to grow by 1.71% this year, according to a central bank survey of analysts.
Africa
● The African Development Bank expects Africa’s GDP growth to accelerate to 4% this year, making it the fastest-growing region after Asia.
● Uganda has secured contracts to export medical marijuana products to Canada and Germany worth more than R2bn (£108m) in June.
● Marouane El Abassi, governor of Tunisia’s central bank, has revealed the country has created a special group to explore the functionalities of a sovereign bitcoin bond.
Japan
● Japan’s factory output unexpectedly fell to 0.9% in March, according to the government.
● Japanese equities pulled in their biggest inflows of cash during the last week of April since March 2018, ahead of the Bank of Japan’s pledge to keep interest rates at super-low levels for at least one more year.
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