The Global Economy and the Euro Area: Weak International Trade, Robust Domestic Demand

Michelsen, Claus; Baldi, Guido; Dany-Knedlik, Geraldine; Engerer, Hella; Gebauer, Stefan; Rieth, Malte (2019). The Global Economy and the Euro Area: Weak International Trade, Robust Domestic Demand. DIW Weekly Report, 9(11+12), pp. 100-101. DIW Berlin Deutsches Institut für Wirtschaftsforschung e.V. 10.18723/diw_dwr:2019-11-2

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The current global economic environment remains harsh. Global growth rates stagnated in the fourth quarter of 2018, particularly affected by foreign trade. DIW Berlin’s forecast indicates global economic growth of 3.7 percent for 2019 and 3.6 percent for 2020. Positive stimuli are expected from catch-up effects (in the European automobile industry, for example) and the continued positive development on the labor markets, which will support consumption. However, the outlook for international trade is dominated by trade conflicts, political uncertainties, and a weaker Chinese economy. Although the trade conflict between the USA and China is beginning to ease, there are signs of a dispute between the USA and the European Union over EU automobile and car part exports to the USA. In Europe, the possibility of a no-deal Brexit and the political situation in Italy are causing uncertainty. Against this backdrop, monetary policy is likely to be expansionary in the forecast period.

Item Type:

Newspaper or Magazine Article

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Economics

UniBE Contributor:

Baldi, Guido

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

ISSN:

2568-7697

Publisher:

DIW Berlin Deutsches Institut für Wirtschaftsforschung e.V.

Language:

English

Submitter:

Dino Collalti

Date Deposited:

17 Apr 2020 08:28

Last Modified:

29 Apr 2020 17:39

Publisher DOI:

10.18723/diw_dwr:2019-11-2

BORIS DOI:

10.7892/boris.138730

URI:

https://boris.unibe.ch/id/eprint/138730

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