Supportive ECB policies and green-shoot growth in several European economies, as Germany successfully avoided a recession, are good news for the market. But the US threat of tariffs on French goods could portend an escalation of tensions.

Market crash fears are out of date. Recent business confidence numbers from the US, China and Germany show the global economy is not down and out. The world’s governments must seize the momentum and find new ways to fund sustainable recovery.

With US economic data suddenly looking brighter and positive noises being made in the trade war, risk reversals could be round the corner. After years as sanctuaries for investors, government bonds may finally lose their mojo in 2020.

Europe’s common market is supposed be a level playing field. But as Germany remains a magnet for foreign capital – most recently Tesla’s – the gulf between Europe’s rich and poor will only widen, fuelling the EU’s existential crisis.

Markets, having priced in the worst outcomes of the trade war, a Trump impeachment and Brexit, now seek good news. As central banks ease policy, political risks recede and with a trade deal in sight, 2020 should be glorious.

The US central bank is cutting interest rates and buying short-term Treasury bills with the aim of supporting the economy. This should give China more room to ease policy and stabilise the yuan, taking some heat out of the trade war.

China’s economy could return to 7 per cent annually, the US could near 4 and the global economy could go back to 5. But this would depend not just on the trade war ending, but appropriate stimulus and reform measures afterwards.

Deficit spending among major economies steadily declined in the years after the global financial crisis ended. With economies around the world slowing, major players – Germany in particular – should abandon austerity now.

The Fed should not only cut interest rates, but up its quantitative easing holdings, thus driving down the dollar. This, and a trade war ceasefire, would not only boost the US economy but the global economy and trade as a whole.

There’s no better way for Trump to fight off the threat to his presidency and increase the chances of his re-election by focusing on improving the US economy and global outlook. The damaging trade war must end.

Europe’s emphasis on austerity and fiscal stabilisation since the global financial crisis is not working. With a recession and no-deal Brexit looming, it’s time for the ECB and European governments to loosen the strings.

The US-China trade war, Brexit and tensions in the Gulf could add up to a perfect storm for the global economy. The world can’t count on Trump. Now, more than ever, Beijing must take the lead.

Since Donald Trump launched his trade war US trade and budget deficits have only grown, and now the US economy is slowing. Better to tame runaway US consumerism and start policy coordination with other major powers to stave off a recession.

China should set a new range for its currency and use the rest of its reflationary tools to reach its 2019 growth target. It should also lead the way in seeking reconciliation at a time when the trade war is hurting everyone.

Germany’s economy is flashing warning signs and with a no-deal Brexit imminent, contagion might spread across Europe and the world. The Chinese economy, already under stress from the US trade war, is vulnerable.

Governments everywhere it seems are turning to stimulus to stave off the very real risk of global recession. This return to Keynesian-centred solutions must avoid boosting inequality again, though; governments should agree on a global ‘New Deal’.

China’s policy options amid a slowing economy are to strike a face-saving trade deal with the US, devalue its currency and offer cheap loans at home. Beijing must use them all.

The US’ overreliance on expansionary fiscal policy when the country is already deeply in debt is a recipe for disaster. Beijing, for its part, needs reforms to spur domestic demand, not currency depreciation that could further provoke the US.

Neither austerity nor supply-side economics that put the haves before the have-nots will pull Europe out of its doldrums. To rescue the economy, Brussels must help its poorer members and spend on key infrastructure and social services.

Britain is an important enough trading partner for the EU to work out a late deal, much as it once did with Greece. Furthermore, Britain looks like it’s taking the gloves off and getting ready to spend big.

While the trade war, political uncertainties in the US and lower interest rates have hit sentiment surrounding the US dollar, risks in Europe and the prospect of higher oil prices could still trigger a flight to the US currency.

The sluggishness of the global economy shows the need for broad policy coordination to head off the next financial crisis. The challenge will be creating conditions that are self-sustaining and which work for all economies, not just a few.

The world has been awash with easy money for a decade and interest rates are already dangerously low. To boost bonds and reward savers, global stimulus should involve more coordinated spending on infrastructure, health and education.

When financial markets crashed in 2008, central banks were quick to slash interest rates and print money. The subsequent financial boom was basically subsidised by taxpayers. Now it’s time financial markets returned the favour.

Central banks cutting rates will only feed the addiction to cheap money. Instead, the US, Europe and Japan must contribute more to global efforts, like infrastructure-spending plans, to reboot recovery and worldwide trade.

As global economic conditions grow more worrisome, China should lower interest rates and ramp up spending in key areas such as health, welfare and pensions, thus motivating citizens to save less and get the consumer-driven economy moving.

Beijing needs more overall policy loosening and stimulus measures to meet its goal, and Trump’s overzealous implementation of tariffs is China’s chance to prove itself to be a responsible economic power.

It can stonewall, but ultimately the US central bank will respond to economic conditions by lowering interest rates. Other major economies have a similar need for stimulus, so this should be a chance for global policy coordination.

US exports to China are down much more dramatically than China’s exports to the US. China has also sold more Treasury bonds in March, putting pressure on the already large US fiscal deficit.

With the trade war threatening already slowing global growth, it could be time for central banks to synchronise their efforts more closely with government fiscal goals. While crossing the line separating government and central banks might be harder in advanced economies, China may be better placed to do so.