Global economic activity strengthened considerably in the first half of this year, helped by a rebound in trade volumes and a marked recovery in industrial production. Although the rapid growth experienced in the early part of the year has faltered, there was still broadly-based, if somewhat subdued, growth in activity in all the major economies in the second quarter of the year, with GDP rising by between 0.3-0.6 per cent in the US, the UK, the Euro Area and Japan. For the year as a whole we continue to expect global GDP growth (measured at Purchasing Power Parity exchange rates) to be around 2¾ per cent, which whilst below long-term trend levels, would be a welcome improvement on the growth of under 2¼ per cent seen in 2001.