It's a week ago now, so it's old news - but it's still worth repeating. One look at Canada's trade data for March would be enough to file it under 'ho-hum' and wait for a more exciting month. Dig a bit below the surface, and the case gets very interesting. What's the big story behind the story?
If the prosperity of the last economic cycle sent public spending exiting stage left, recession handed it the lead role. Its initial act was heroic – rescuing a world economy destined for depression. Now it’s the villain: paying back fiscal largesse is dragging down economic growth, fuelling near-term jitters and bringing down governments. To most, this is just the near end of a long, drawn-out act.
Have you noticed? Rhetoric about the key risks to the near-term economic outlook seems more muted these days. This makes good sense if the near-term forecast is indeed improving, as higher growth generally makes the risks easier to handle. But one risk stands apart: Iran’s nuclear standoff with a coalition of Western and like-minded states is inching toward a crisis point.
As advanced economies faltered in the Great Recession, hopes shifted to the fast-growing BRIC nations. They didn’t disappoint, until recently. Now, numbers reveal a BRIC slowdown, with important global implications. Are the stars of the last decade truly global growth engines, or are they fading?
Everyone’s talking about it. It’s nothing new, but it’s now the mantra of the moment. ‘New normal’ is used everywhere to describe current and future conditions, and what it means for most is perpetual sluggish growth. Is popular sentiment right this time? Will the world economy be weighed down indefinitely by negative structural developments, or is there something better to look forward to?
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