World Bank’s latest Global Economic Prospects report … headlines:
- Forecasts global real GDP growth at 2.7% in 2017 vs 2.3% in 2016
- Forecasts advanced economies’ growth at 1.8% in 2017 (vs 1.6% in 2016)
- Emerging/developing economies’ growth at 4.2% in 2017 (3.4% in 2016)
- Forecasts US growth at 2.2% in 2017 (vs 1.6% in 2016) … they say their forecast excludes effects of any policy proposals from trump administration
- Challenges for emerging market commodity exporters are receding, while domestic demand solid in emerging market commodity importers
- Fiscal stimulus in US could generate faster domestic and global growth, but extended uncertainty over policy could keep global investment growth slow
- Forecasts China’s growth slowing to 6.5% in 2017 (from 6.7% in 2016)
(Headlines via Reuters)
The World Bank looking at the recovering oil and commodity prices, noting this eases the pressures on emerging-market commodity exporters. Expects the recessions in Brazil and Russia to end.
As always the Bank notes uncertainties in its forecasts (all forecasters should), with upside uncertainty (in the short term at least) on US potential increased fiscal stimulus, tax cuts, infrastructure spending. Looking further out, though, a surge in debt load, higher interest rates & tighter financial conditions would have adverse effects.
Also downside potential on a more protectionist trade stance.