Global economic growth is likely to pick up a bit in the second quarter, led by household consumption, which is being boosted by an upturn in consumer confidence. The recovery continues to be broad-based as the euro-zone and Japan, which have been weak links in the global economy since the financial crisis, enjoy a burst of above-trend growth and several emerging economies come out of recession. China is the only major economy which is losing momentum, as the authorities bear down on credit growth. Meanwhile, although inflation has dipped in the euro-zone and, most significantly, the US, this will not throw policymakers off their course. The ECB is likely to tweak its policy guidance later this week, and the Fed to raise rates by 25bp a week later.
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