The big picture is that the world has made considerable progress in shaking off the effects of the 2007–08 financial crisis. Some countries have made more progress than others, but, taken as a whole, the world economy is operating close to potential, and monetary policy has begun the process of normalization.
In our latest Monetary Policy Report, we noted that the global expansion, which had been quite synchronous across regions, has become less so recently. The US economy is now setting the pace among advanced economies, primarily due to the additional fiscal stimulus that has been applied.