Here is a short series looking at economic factors that have an impact on business, elements that are beyond the control of your business which you should be aware of - and keeping an eye on. There are also a few links to information sources.
Part 4 - Global Economies
This is a complex one to keep an eye on. Most of the information comes from the commentators, they are normally trying to sell their stories so you do have to take a little pinch of salt when reading them.
There have been warnings about a global recession - the impact on business is clear if this were to happen.
We know that the US-China tariff war is resulting in a downturn of trade, the focus has been on steel but now Mr Trump is looking at computer games, consoles, laptops and mobile phones.
US growth is slowing, last year with income tax cuts in USA, corporate giveaways and the hype of USA first the growth went interstellar forcing the Federal Reserve to put up interest rates to calm things down.
Higher borrowing costs, the end of the "sugar rush" economy, trade wars with China, which has increased import costs, leads to a decline in the US manufacturing sector - first time in 10 years.
(source: US Bureau of Economic Analysis - graph from "The Guardian")
Recession in Germany
It looks very much like Germany is going to enter two consecutive quarters of negative growth. The graph below is from the BBC
The slow down in exports for Germany have been very troubling and the threat of tariffs on European made cars by President Trump are not encouraging for Germany - BMW and Volkswagon!
China has a debt crisis.
The UKs' experience of excess debt led to years of difficulty. Currently the debt situation in China is troubling, excessive corporate and consumer lending combined with a 30 year low in industrial production growth has banks worrying about loans that can not be repaid.
Clearly the issues highlighted here does not present the most positive outlook, it does highlight the importance of understanding global economic factors that could reverberate within our local markets.