State of the Economy: June 2019
Recent developments in the global, UK and Scottish economies, and analysis of the performance of, and outlook for, the Scottish economy.
Global Summary
Global activity softened over the past year.
The global economy grew 3.6% in 2018, with the pace of growth slowing in the second half of the year and into 2019.
Slower growth over the past year has been broad based in both Advanced Economies, and Emerging Market & Developing Economies.
Growth in world trade volumes in 2018 was subdued compared to 2017 amid heightened global trade tensions.
A softening in commodity price growth over the year has eased inflationary pressures and been more supportive of consumer spending.
The IMF forecast global growth to slow further in 2019 to 3.3% with ongoing trade tensions, weaker business sentiment and political uncertainty downside risks.
US economic growth strengthened at the start of 2019.
US GDP grew by 0.8% in Q1 2019 (3.2% annually), picking up from 0.5% growth in Q4 2018.
US unemployment declined to 3.6% in May, its joint lowest rate since December 1969.
US CPI inflation eased to 1.8% in May 2019 – down from 2.0% in April with food price inflation offsetting a fall in energy prices.
The IMF forecast US GDP growth to slow across 2019 and 2020 to 2.3% and 1.9% respectively.
Euro Area GDP growth rebounds in Q1 2019.
Euro Area GDP growth slowed in the second half of 2018, however strengthened to 0.4% over the first quarter of 2019 (1.2% annually).
Euro Area unemployment fell at the beginning of 2019 to 7.6% in April, the lowest rate since August 2008.
Euro Area inflation eased to 1.2% in May, down from 1.7% in April, with weaker growth in energy and services prices compared to April’s annual rate.
The IMF forecast Euro Area GDP growth to slow further in 2019 to 1.3%, before picking up to 1.5% in 2020.
| GDP Growth (%) | Estimate | Projections | Revisions from January 2019 | ||
|---|---|---|---|---|---|
| IMF WEO (April 2019) | 2018 | 2019 | 2020 | 2019 | 2020 |
| World Output | 3.6 | 3.3 | 3.6 | -0.2 | 0.0 |
| Advanced Economies | 2.2 | 1.8 | 1.7 | -0.2 | 0.0 |
| United States | 2.9 | 2.3 | 1.9 | -0.2 | 0.1 |
| Euro Area | 1.8 | 1.3 | 1.5 | -0.3 | -0.2 |
| United Kingdom | 1.4 | 1.2 | 1.4 | -0.3 | -0.2 |
| Japan | 0.8 | 1.0 | 0.5 | -0.1 | 0.0 |
| Emerging Markets and Developing Economies | 4.5 | 4.4 | 4.8 | -0.1 | -0.1 |
| China | 6.6 | 6.3 | 6.1 | 0.1 | -0.1 |
| India | 7.1 | 7.3 | 7.5 | -0.2 | -0.2 |
| Brazil | 1.1 | 2.1 | 2.5 | -0.4 | 0.3 |
| Russia | 2.3 | 1.6 | 1.7 | 0.0 | 0.0 |
| South Africa | 0.8 | 1.2 | 1.5 | -0.2 | -0.2 |
Contact
Email: OCEABusiness@gov.scot
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