US and China bookend the global outlook

<p>Kia ora,</p><p>Welcome to Monday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news China is struggling, the US is pumping, and everyone else is in between.</p><p>First up, the head of the World Trade Organisation has <a href="https://www.bbc.com/news/business-60949053" target="_blank"><strong>said</strong></a> the Ukraine war has forced them to cut their global trade growth forecast for this year from +4.7% to +2.5% due to "the impact of the war and related policies".</p><p>But so far, such a sharp turn down isn't showing up in the granular data. March factory PMIs in the Asian region shows most expanding at moderate levels. That includes <a href="https://www.markiteconomics.com/Public/Home/PressRelease/cf3287f1b18d4f5382c2b41c0c8c4144" target="_blank"><strong>Taiwan</strong></a>, <a href="https://www.markiteconomics.com/Public/Home/PressRelease/709ffea1efdd451eba39927c3b18363b" target="_blank"><strong>South Korea</strong></a> and <a href="https://www.markiteconomics.com/Public/Home/PressRelease/57e5382c70c84ce5840bf50077eaeb9a" target="_blank"><strong>Japan</strong></a>.</p><p>And although Indian imports rose sharply, Indian exports rose to US$40.4 bln in March, easily an all-time record high and confirming global demand remains solid - although some of this could be a switch from China.</p><p>The private sector factory <a href="https://www.markiteconomics.com/Public/Home/PressRelease/31a0f0a997904b1c851fbd07d4a0d00b" target="_blank"><strong>PMI for China</strong></a> came in lower than the official version (49.5), contracting at an index value of 48.1 when a steady-state 50 was expected. It was their biggest fall in more than two years. It will only get worse for China as they stumble over their new pandemic spread that is high risk because they have key demographics with very low vaccination rates - and they have a second-class vaccine that is <a hre