Global Economic Growth Remains Front and Center

In a recent poll conducted by the Wall Street Journal, more than 90% of the 48 economists surveyed said they expect economic growth in the US to continue accelerating, but are very concerned about growth in other parts of the world. Chinese industrial production numbers were weak last month, with many economists calling for further government stimulus in order to hit the 7.5% full-year GDP target.  Not only has growth and inflation declined in the Eurozone, but regional independence movements have emerged as a major theme.  Financial markets were spooked last week after a poll of Scottish citizens showed an increase in support for seceding from the U.K. in a vote that will take place this week. On the back of this news, talk re-emerged in other regions of Europe, such as the Catalonia in Spain, about breaking away. While the economic impacts of such actions are difficult to accurately predict, the all-important business confidence factor will likely be diminished by successions.    As we have touched on in recent market notes, weak overseas growth and low confidence has pushed more money into US Treasurys, keeping a lid on our yields. This trend reversed last week as bonds sold off. However, any significant US rate rise will likely have to be accompanied by improved economic conditions overseas, which appears unlikely at this point.