For the second year in a row, John Walker, Chairman and Chief Economist of Oxford Economics, gave his perspective on the current economic climate at the National Fluid Power Association (NFPA) Industry and Economic Outlook Conference (IEOC). Mr. Walker is responsibie for all of Oxford Economics' global economic analysis, forecasting, and consulting activities.
His presentation gave an overall perspective of the global economy that reflected some slow growth over the next year and a half. He mentioned that the global purchasing managers index figures showed weak growth in the U.S., Japan, and Europe. However, Walker did mention that the global economy is still on a roller coaster ride so this leaves the door open to stronger trends in either direction.
He listed four forces that are shaping the global economic cycle. First, deleveraging where banks have reduced their debt in most of the developed world. Second, austeriety programs where fiscal problems in Europe lead the way to budget cuts. Third, cash hoarding by corporate sectors that are maintaining very high levels of cash. Fourth, high commodity prices have had consequences led by oil and reduced spending capacity.
