The global economy is under serious pressure. What should be on your radar?

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TODAY'S NEWS. TOMORROW'S INSIGHTS. A daily newsletter from McKinsey & Company   Edited by Katy McLaughlin   Senior Editor, Southern California Watching the world economy In the news • Seismic activity. The global economy faces structural changes due to aging populations, the climate crisis, and a retreat from globalization. Each of these drivers cause a chain reaction: aging populations, for example, mean fewer workers, which could trigger inflation and provoke tighter monetary policies. Fallout from these tectonic shifts can only be mitigated by deep reforms to education, healthcare, the energy system, and investments in innovation, all with the goal of improving efficiency and productivity. [Reuters] • Spotlight on India. What's gone up while everything else has gone down? The Indian economy, which is expected to grow at least 7% this year—more than twice the amount the world economy is projected to grow. The country's rebounding economy drew strength from a massive COVID-19 vaccination effort that helped to revive investment and consumer spending. While other large economies face slowdowns and possible recessions, India's economy is looking like a global bright spot. [NYT] Global indicators are reflecting the general slowdown, with a noticeable time lag, as disruptions crowd one upon the other. On McKinsey.com • Falling back. In most of the world, signs of slowing growth are proliferating. US GDP contracted 0.6% on an annualized basis in the second quarter of 2022, following a –1.6% decline in the first quarter. GDP growth in China slowed to 0.4% in the second quarter, after growth of 2.5% in the first half of 2022. The eurozone outpaced expectations, with GDP growth at 0.6% in the second quarter and 1.1% growth in the first half. But growth expectations for the rest of the year are unusually fraught, as Europe in particular faces surging energy prices as a consequence of the war in Ukraine. • Springing forward. Energy independence is proving costly to Europeans: on August 26, Europe's benchmark natural gas price reached 30 times the level of two years ago, which has helped drive consumer inflation in the eurozone to 8.9% in July. Elsewhere, inflation declined slightly from the prior month, to 8.5% in the US, 10.1% in Brazil, and 6.7% in India. In China, inflation ticked up to 2.7%. Dive into McKinsey's data-rich analysis of the world economy. Get the global summary Was this forwarded to you? Sign up here. Or send us feedback— we'd love to hear from you. Follow our thinking This email contains information about McKinsey's research, insights, services, or events. By opening our emails or clicking on links, you agree to our use of cookies and web tracking technology. For more information on how we use and protect your information, please review our privacy policy. You received this email because you subscribed to the On Point newsletter. Manage subscriptions | Unsubscribe Copyright © 2022 | McKinsey & Company, 3 World Trade Center, 175 Greenwich Street, New York, NY 10007