EXECUTIVE SUMMARY
Global growth was solid in the first half of 2018, though that relative stability is thanks to a US economy that has been going from strength-to-strength. Indications are the global output gap is broadly closed, as growth has improved and global inflationary pressure will gradually continue to build.
Trade policy is the biggest downside risk. While North American trade negotiations ended positively with a new US-Mexico-Canada Agreement featuring no significant changes, the US administration announced it would impose additional tariffs on Chinese imports. China subsequently announced further tariffs of its own, and where the trade conflict heads from here is uncertain …