The recovery of the global economy is often summarized down to a single letter of the alphabet.
But for Paul Donovan, managing director and deputy head of global economics at UBS, the recovery is shaped more like a brand symbol.
“We’re ending up with something a little more akin to the Nike swoosh," said Donovan. "You come down pretty abruptly and we are definitely improving. Absolutely, no question. But it’s going to be a fairly slow recovery. There are a lot of headwinds we’ve got to battle against.”
Appearing on CNBC on Monday, Donovan emphasized that the recovery will be a slow grind, especially in Europe and the U.S.
He said the markets were in for a lower trend environment this year and though there may be some growth next year, it will not be enough to impact the unemployment rate.
Donovan said the unemployment rate for the U.S. at the end of next year will likely be 9.5%, compared to a normal rate of 5.25%.
“Now that’s a lot of unemployment. There’s a lot of spare capacity in the labor market”