Factory activity has contracted across Asia and Europe due to the escalating trade war between the US and China. A world recession is feared. The trade war has damped automotive demand. Higher trade tariffs may take their toll on global commerce and further dent business and consumer sentiment, leading to job losses and delays in investment decisions. The outlook remains grim as output growth slips, factory prices stall and businesses get pessimistic on production. The trade war has not only become a technology war but also a broad-based business war.

Central banks in Australia and India are expected to cut rates this week, with others around the world seen following suit in the coming weeks and months. While US manufacturing is expected to grow steadily, the global malaise is expected to eventually feed back into the US economy. In Britain, the Brexit stockpiling boom of early 2019 gave way last month to the steepest downturn in British manufacturing in almost three years as new orders dried up, boding ill for economic growth in the second quarter. The euro zone economy is under pressure.

America’s new tariff threats against Mexico have also contributed to global recession fears, with stock markets tumbling around the world.