The world economy appears to have embarked upon a cyclical upturn this year. Despite the widespread fears of a year ago, the downturn in global demand that began in the latter half of 1997 proved unusually mild and short-lived compared to others seen in the past three decades. Our latest projections indicate that global output growth is likely to have picked up to 2.9 per cent this year from 2.4 per cent in 1998, and may accelerate further to 3¼ per cent next year. In the OECD economies output growth has accelerated this year to 2.8 per cent, with a continued robust expansion in North America and a gradual stabilisation of the Japanese economy more than offsetting the relatively mild slowdown in the Euro Area and the UK. Elsewhere there has been a strong rebound in output in many of the Asian economies, and the impact of the currency crises in Brazil and Russia appears to have been absorbed more easily than had been expected at the time they occurred.