25th January 2019
Hugues Chevalier, Economist
The scenario of a slowdown in the global economy has materialised in recent months, particularly in OECD countries, with the exception of the United States. It is penalised by the sharp rise in oil prices, the consequences of the Sino-US trade war and political uncertainties such as Brexit. The US tax reform, initiated at the end of 2017, vigorously supported growth in 2018. However, the positive effects of this reform will not be repeated in 2019, so that activity should slow down across the Atlantic, without causing a recession. In Europe, activity has slowed since the end of 2017. But the European economy should not fall into a recession in 2019. Indeed, the fall in oil prices in recent weeks should support activity, especially household consumption. In emerging countries, after a general slowdown in 2018, due in particular to the tightening of US monetary policy, 2019 should be marked by a stabilisation of activity and currencies. Risk factors are nevertheless present, in particular the ongoing trade war between China and the United States, which is penalising world trade. Overall, global growth is expected to slow to 3.7% this year, compared to 4% in 2018. GDP in industrialised countries is expected to decelerate to around 2%, compared to 2.2% in 2018. In emerging countries, growth should remain stable in 2019 at about 5%. This central scenario could notably be revised downwards in the event of a worsening of trade tensions between the United States and China.