Above potential economic growth continues to be a global theme as global and world economies are finally benefiting from years of easy monetary policy. Momentum is powerful and is currently self-reinforcing. Practically all economies are growing above potential and slack has already disappeared or is disappearing rapidly. Recent global data have been a bit softer than expected, and signs are emerging that global growth has peaked and has begun to slow gradually. Read the Outlook Assesment.
While the U.S. economy has just put together the best two consecutive growth quarters of the current economic expansion, Europe and China have clearly lost momentum and growth, although still strong and well above long-run potential in many countries, is decelerating. Read the letter.