The January jobs report indicated that half a million new jobs were created last month and unemployment was staggeringly low, equivalent to how its levels in the ’60s. This was a pretty clear signal that the economy doesn’t seem to be cooling off as much as some economists feared it might after several rounds of interest rate hikes.

The global economy might not be doing as badly as experts feared, either. It slowed markedly in 2022 and it’s expected to weaken further this year. But some patches of the globe are performing better than expected.

Energy prices have fallen. Inflation is slowing. And in many countries, COVID is no longer a serious economic drag. 

“The global outlook has undoubtedly improved over the past couple of months,” said Neil Shearing at Capital Economics. He added that the outlook for Europe previously seemed dire, with Russia’s war in Ukraine making natural gas scarce and expensive.

However, in the past few months, Shearing said, “The price of European natural gas has absolutely collapsed, and that really removes a substantial headwind to the Eurozone’s economy.”

Europe has also done a good job of conserving its natural gas.

“We’ve had an extremely mild winter here in Europe,” Shearing explains. “For a large part of January, we were actually building supplies of gas in storage, believe it or not.”

China, meanwhile, has jettisoned its zero-COVID policy and unleashed a wave of consumer spending, according to Shearing.

“I think the economic rebound in China is going to be more rapid than investors and other people are anticipating,” Shearing said.

But China’s rebound won’t be anything like the “revenge spending” spree we saw in the U.S., per Adam Posen at the Peterson Institute for International Economics. 

“They did not build up the kind of excess saving in China that we saw built up in the U.S., partly because for a large number of Chinese [citizens], they were having to survive on their savings,” Posen said.

Posen added that major emerging markets — Brazil, India, Mexico, Indonesia — are doing pretty well.

Plus, in spite of continuing problems like getting grain out of Ukraine, worries about food insecurity are falling. Morning Consult’s Sonnet Frisbie said the polling firm asked consumers worldwide if they’re worried about being able to pay for groceries.

“I was surprised to find there’s not a big difference in emerging and developed markets,” Frisbie said.

Bottom line: If the global economy does end up performing a little better than economists have been predicting, that only helps the economy in the U.S.