prasad24_Michael M. SantiagoGetty Images_nyse Michael M. Santiago/Getty Images

A Weak, Uneven Global Recovery

The pace of economic recovery varies significantly between the world’s major economies, with the United States and India growing robustly while China is slowing down. The challenge facing policymakers worldwide is to develop policy frameworks that reduce uncertainty and boost business and consumer confidence.

ITHACA – A world burdened by geopolitical conflicts, protectionist policies, and persistent inflation is weighing heavily on economic growth. But while the latest update of the Brookings-Financial Times Tracking Indexes for the Global Economic Recovery (TIGER) shows that global growth has plateaued, some countries’ economic rebounds offer glimmers of hope for the year ahead.

The pace of economic growth varies significantly between countries, particularly the world’s major economies. While the United States and India have maintained strong performance, China’s economy is slowing. Such divergences are also evident within the eurozone, with Germany teetering on the brink of recession while the Italian and Spanish economies perform better than expected.

The second divergence is between actual economic outcomes and financial markets, as stock markets rally even in countries with lackluster growth and tight monetary policies. Moreover, household and business confidence is rising around the world despite the heightened uncertainty caused by geopolitical shifts and volatile domestic politics.