In August, Purchasing Managers’ Indexes (PMI) slid to 45 across the world, anticipating a foreseeable GDP contraction. Economic indicators are deteriorating simultaneously in the world's three major economies. Rate hikes are beginning to take their toll on US activity, Europe is facing a tough situation with historic spikes in energy prices, and China is experiencing a ‘perfect storm’ with the implosion of its housing bubble. Against this backdrop, it is critical to gauge every aspect of this summer's major events to determine the severity of the situation, and more importantly, to be able to outline future interest rate and inflation scenarios, as medium-term investment outlook will largely hinge on future growth, rates and inflation.