The performance of the luxury industry depends on the vigour of the global economy and the success of people who want to buy upmarket products. Aspirational consumers of luxury goods have done relatively well almost everywhere. But the growth of the world economy is disappointing. The performance of the global luxury sector — worth €250bn a year, according to a Bain study — will depend on how the balance between these two elements works out.
Yet again, the International Monetary Fund has downgraded its economic forecasts in its latest world economic outlook, released last month. The baseline projection for this year is for 3.2 per cent growth of the world economy, measured at purchasing power parity. This is much the same as last year, 0.2 percentage points lower than was forecast as recently as January and 0.4 percentage points lower than was forecast last October.
This level is surely no disaster, but the consistent downgrading of growth rates is a worry.