A relatively stable global political landscape combined with a broad consensus in favour of free markets and international trade encouraged investment and supported productivity. Technological advancements also lifted global productivity, shrank distances and lowered costs. The entry into the global trade system of vast new labour markets in China and Eastern Europe pushed down the prices of many traded goods.
Global supply chains grew rapidly, minimizing costs by linking the global economy through heightened specialization and trade. These supply developments all fostered a period of solid growth, low inflation and low interest rates. But these forces are now shifting. The failure to adequately share the benefits of growth has fuelled populism that is causing countries to turn inward.