I think I would be looking for very clear evidence that inflation was durably put down, because I would be very concerned that we would confuse touching 2% with achieving 2%, and even more concerned with touching 2.7% and regarding that as a basis for easing…I would be very much aware that if the transmission from monetary policy to inflation when there had been tightening was more direct, and involved output less than one might have expected, there was the risk of something parallel on the loosening side. So I would be in less of a hurry. The current market view that we will have a soft landing and the Fed will be able to cut rates by 100 basis points over the next year strikes me as possible, but it is not at the centre of my expectations. We may have no recession, in which case I rather doubt that the Fed will be able to cut rates by 100bp, or we may have a recession, in which case the Fed will cut rates by somewhat more than 100bp.
- Date Posted:
- December 14, 2023
[We] examined changes in global shares of value-added output in 10 advanced industry sectors: pharmaceuticals; electrical equipment; machinery and equipment; motor vehicle equipment; other transport equipment; computer, electronic, and optical products; information technology and information services; chemicals (not including pharmaceuticals); basic metals; and fabricated metals. The 10 industries included in the Hamilton Index together accounted for more than $10 trillion in global production in 2020. As of 2020, China was the leading producer in seven of the ten strategically important industries in ITIF’s Hamilton Index. Overall, China was producing more than any other nation—and more than all other nations outside of the top 10 combined. Hamilton Index industries accounted for approximately the same share of the global economy in 2020 (11.8% ) as in 1995 (11.9% ), underscoring how the race for global advantage in these industries is a zero-sum competition. China’s gains have come at the expense of the United States and other G7 and OECD economies. From 1995 to 2020, China also captured more than 80% of non-OECD countries’ gains.