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U.S. economic growth in the second quarter fell short of projections as supply constraints led to a big inventory drawdown in the face of resilient household spending.
The economy in the euro area was stronger than forecast in the second quarter, led by southern European nations. Growth in Germany, like the U.S., trailed expectations as supply-chain disruptions weighed on key industries.
In China, manufacturing-intensive provinces along the country’s eastern coast benefited from the robust economic recovery in the first six months of 2021.
Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:
Growth missed forecasts in the second quarter as the effects of supply-chain constraints reverberated through the economy and took the shine off one of the biggest gains in consumer spending in decades. The report underscored the robust bounce back in household demand as well as the challenges companies are facing keeping pace with that demand.
Monthly data showed a solid hand-off ahead of the third quarter. Personal spending accelerated more than expected in June, reflecting a ramp up in outlays on services. The 1% gain underscores solid demand thanks to vaccinations and a broader reopening of the economy.
The euro-area economy dusted off the impact of its crippling winter lockdowns, with strong rebounds in Spain and Italy spurring the region’s growth to exceed expectations in the second quarter. Elsewhere in Europe, Sweden grew faster than projected for a second straight quarter and Czech GDP also advanced.
Londoners appear far more interested in getting back to shops and restaurants in the West End than they are in returning to the office: Minicab and courier company Addison Lee says that passenger bookings to and from the capital’s financial hubs recovered less than expected.
China’s rapid economic recovery in the first half of the year was fueled by manufacturing-heavy provinces on the eastern coastal line of the country, widening the gap with inland regions.
Thailand will likely be the worst economic performer in Southeast Asia this year, with economists continuing to slash the country’s growth forecast amid surging Covid-19 infections, mounting political tensions and fading hopes for a tourism revival.
As Brazil contends with its worst drought in almost 100 years, its ports and their regulator are intensifying efforts to quantify the risks of climate change for the nation’s sea hubs.
The International Monetary Fund maintained its outlook for the biggest rebound in global economic growth in four decades while changing underlying regional forecasts, with unequal access to vaccines further widening the recovery gap between advanced and developing economies.
The increase in coronavirus cases is a reminder that Covid-19 is likely here to stay, raising the prospect of permanently lower output relative to the pre-Covid path as contact intensive services suffer. In Bloomberg Economics’ worst case scenario, the appearance of vaccine resistant variants could result in a stop-go world economy, with sporadic lockdowns and reopening dragging major economies in and out of recession.
The gains for commodity exporters will easily outweigh their losses last year as the pandemic spread and crushed demand for raw materials: Bloomberg Economics estimates that $550 billion will shift from importers to exporters in 2021, nearly double the $280 billion reverse transfer last year when prices collapsed.
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