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Cushman & Wakefield
AMERICAS EUROPE APAC GLOBAL APPENDIXECONOMIC DRIVERS
After several years of mostly disappointing growth, the global
economy is finally showing clear signs of momentum. Although
the growth spurts vary greatly from one country/city to the
next, the economic upswing in mid-2017 is more ubiquitous
than at any other point in the current cycle. From the U.S. to
Continental Europe to Asia Pacific, in mature markets as well
as emerging ones, from Tier-1 to Tier-2 cities, from commodity-
producing to commodity-consuming nations—a multitude of
signs indicate that the world economy is set to grow faster.
World GDP growth is projected to rise from 3.1% in 2016—the
nadir of the current cycle—to 3.5% in 2017 and 3.6% in 2018.
If these developments come to fruition, those would be the
strongest back-to-back years for global growth since the
initial rebound years of 2010 and 2011. Moreover, there are still
significant tailwinds and scenarios that may push growth rates
even higher in the near term; fiscal policy-easing in the U.S.,
The economic momentum is
more ubiquitous now, inmid-
2017, than it has been at any
other point in the current cycle.
Global
soaring equity prices and rebounds in confidence may translate
into higher consumption and business investment than is
currently assumed.
A number of developments could still derail the momentum.
Global equity markets have been riding the euphoria wave
of a still very hypothetical fiscal stimulus scenario in the U.S.
If policymakers don’t deliver, a negative wealth effect could
very well ensue, ultimately dragging economic and real estate
conditions down. Another downside risk to the expansion
comes from protectionist movements. A policy shift towards
more isolationism and greater trade warfare would certainly
impact capital and trade flows, and thus harm economic
growth. Another threat comes from diverging global monetary
policy conditions at a time when many central banks are in
uncharted territory: e.g., negative interest rates, asset purchase
SYNCHRONIZED GROWTH
REAL GDP, Yr/Yr%
Source:
U.S. BEA, Oxford Economics, Cushman & Wakefield Research
0
2
4
6
8
China
World Eurozone United
Kingdom
United
States
Canada Japan
2016Q1
2017Q1