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Global growth shows clear slowing signs

The global economic expansion is likely to be running out of steam while Brexit talks are just heating up.

Spotlight on services sector ahead of Trump’s delayed address

Growth in China, the Eurozone and Japan has slowed sharply in the third quarter, according to the Organisation for Economic Co-operation and Development’s (OECD) new forecasts. The OECD also warned the world economy had “passed its peak” and faces “growing risks”.

Although global expansion is likely to continue, it will do so at a slower pace of 3.5 per cent in 2020, compared to 3.7 per cent in 2018. Japan’s third-quarter data showed the economy contracted at an annualised rate of 1.2 per cent. And Germany suffered its first contraction since 2015 after exports tumbled as a result of a souring global trade environment.

Brexit is still 127 days away, but it has already had a negative impact on the UK’s budget deficit, according to the Office for National Statistics (ONS). The shortfall in October was the biggest in three years, having risen from £7.24 billion a year earlier to £8.82 billion.

Meanwhile, the UK and EU made significant progress yesterday, 21 November, in Brussels. Following two hours of talks, UK Prime Minister Theresa May and European Commission President Jean-Claude Juncker stated that both sides now have enough direction to resolve remaining differences and issues.

Finally, in more positive Brexit news, German Chancellor Angela Merkel gave her seal of approval for May’s Brexit deal and expressed her hope that Spain’s objection to the wording over the disputed British territory of Gibraltar can be resolved by Sunday, 25 November ahead of the EU members states’ meeting this weekend to discuss the UK’s divorce from the EU.

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