World GDP appears to have expanded at a below-trend pace in Q1 as high inflation limited real consumer spending and supply shortages and Omicron waves continued to disrupt activity. March’s broad-based drop in consumer confidence suggests that consumer spending growth is likely to weaken further. Encouragingly, our G7 Shortages Indicators showed further signs of improvement in March and we expect shortages to alleviate as the year goes on. But there are downside risks in the near term. Firms in central Europe and the euro-zone have reported lengthening delivery times since the start of the war in Ukraine. Meanwhile, the 25% fall in road freight flows in China in the past two weeks highlights the risks that virus containment efforts there may yet disrupt global economic activity.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services