It is clear now that 1991 will be a year of slow growth for the world economy. In the United States in particular there is real fear that a contraction of credit will result in a sharp cutback of economic activity. Our central expectation is that a reduction in inflation, helped by lower oil prices, and a rather more relaxed monetary policy will prevent a deep or prolonged downturn in America. Moreover the buoyancy of investment demand in Germany will help sustain activity in the European economies. The case of the UK economy is potentially more serious, although even here it is reasonable to expect a recovery from the recession to be under way by the end of this year.