Most countries experienced downturns in their economies this year and each is now scrambling to halt inflation and restore growth. France appears to be first in line toward a turnaround, while Germany seeks to stanch its export slump and Japan launches government incentives. While there has been some slowing, in most of our countries, the conditions for continued growth appear to be in place and inflation is well under control.
Statistics paint a worrying picture.
In the U.S., industrial production declined for the third consecutive month in May, the first time since the last recession. In Canada in the same month, the composite leading index fell, also for the first time since the recession ended in 1991. In Japan, deflation is taking hold. However, Goldman sees this as a ''temporary pause'' rather than as the start of a major downturn. Several factors have contributed to this darker future.