Global growth was sluggish in the first quarter, but it is likely to pick up a bit during the rest of the year. A policy-induced rebound in China and recovery in the prices of key commodities should result in slightly faster growth in emerging economies. Meanwhile, the US and UK should grow by at least 2% this year. But growth is set to remain very sluggish in the euro-zone and Japan. Against this backdrop, we expect the Fed to raise rates faster and further than most anticipate, beginning with a 25bp hike in June, while the ECB and Bank of Japan will probably ease policy further.
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