Jeffrey: Below trend growth is the new normal

Cazenove's CIO Richard Jeffrey has criticised policymakers who expected the global economy to bounce back to pre-crisis levels after 2009, branding such expectations a 'fallacy.'

Jeffrey said a drop-off in domestic consumption coupled with rising inflation in Asia meant growth could not rebound to normal levels, and he expects it to remain sluggish for the rest of the year. "The fallacy in thinking has been that the world economy could return to anything like a normal growth path after the 2008/09 recession. To this extent, post-recession growth rates recorded for many countries have been unduly flattering." Jeffrey said various factors had been blamed for the sub-trend growth suffered by the UK economy, including weather conditions and the royal wedding, but ...