× Home Modules Articles Videos Life Events Calculators Quiz Jargon Login
☰ Menu

Global economic snapshot - October 2019

Written and accurate as at: Oct 15, 2019 Current Stats & Facts

The global economy, excluding the US, seemingly continues to suffer stubborn growth and lacklustre inflation.  Australia included.  Here is a quick snapshot of the current environment.

United States

The Fed followed through with the widely anticipated easing on 18 September, cutting the Fed funds rate to 1.75–2.00% signaling a further rise to 2.1% in 2021 and 2.4% in the long term. Meanwhile, the market is anticipating 1.25% by late 2020. Higher inflation is challenging the market view. Improved wages, coupled with robust consumption, saw CPI increase to 2.4%, the highest reading since early 2008.

Europe

European growth remains weak. Pessimism is at similar levels back in 2009 when German manufacturing was also just as soft indicating the possibility of a recession.

China

The Chinese economy remains under pressure prompting changes in fiscal and monetary policy to agitate stimulus. June quarter GDP was 6.2% representing the slowest growth in 27 years, and August industrial production growth was down to 4.4%, which is the lowest in 17 years. The toll of the trade war is starting to bite.

Australia

The Australian economy isn’t in a technical recession, albeit going backward on a per capita basis at -0.2% for the year not seen since the global financial crisis. The unemployment rate edged up to 5.3% while the underemployment rate rose to 8.6%. Given this, it is difficult to forecast any wage growth suggesting a high probability of the RBA cutting the cash rate to 0.5% by year-end.

You may also be interested in...

no related content

Follow us

View Terms and conditions