The world economy continued to expand in the first half of 2008, although growth rates varied considerably from region to region. Whilst the upturn in the emerging economies of Asia remained strong, the US economy continued to show marked weakness.

In the United States, the housing market crisis, weak financial markets and high oil prices have put the brakes on growth, with GDP barely surpassing stagnation levels. The weak economy and continuing risk to the financial system caused the US Federal Reserve to cut its key interest rate four times by a total of 2.25 percentage points to 2%.

In Asia, the upsurge continued more or less undiminished, with growth even accelerating in Japan. In China, economic momentum slowed somewhat compared with the previous year. However, GDP growth remained quite high at 10.4%.

In the euro zone, the weakening economic trend was increasingly evident in the second quarter. Nevertheless, the European Central Bank raised its key rate by 0.25 percentage points to 4.25% at the start of the second half of the year in an attempt to counter inflation.

After a good first quarter, signs of economic fatigue also began to appear in Germany. New orders and industrial production let up and company sentiment softened.