The pace of global growth slowed in the first quarter, but it is likely to recover during the rest of the year and in 2016. The windfall gains from lower oil prices, rising employment and continued loose monetary conditions will feed through to stronger demand in most advanced economies. China’s economy should continue to slow, but growth in emerging economies overall may pick up a bit next year. Meanwhile, we think the rise in the US dollar is a net positive for the world as it should boost exports from some weaker economies. Further ahead, though, the risk of prolonged deflation in the euro-zone and Japan continues to cast a shadow over prospects for 2016 and beyond.
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