The World Bank has released its 2017 Global Economic Prospects: Weak Investment in Uncertain Times (free, no sign up). A key takeaway is the importance of understanding the US fiscal, structural and monetary policy agenda, any aspect of which could have major implications for the global economy.
Key Points from Exec Summary & First Chapter
- Emerging Markets likely to pick up but challenges with investment and productivity growth in mid-term.
- Commodity-importing regions (East Asia, Pacific, South Asia) could experience solid growth.
- Commodity-exporting regions have a mixed picture.
- US Policy (especially fiscal) could have major impacts but monetary policy could offset that.
- Developed economies have slow growth, partly from policy uncertainty.
- Recommends policies to reinvigorate investment and stimulate demand.
- Global trade in 2016 – worst year since global financial crisis. Possible to recover in EMs in 2017-2018 from new import demand.
- Main risks – policy uncertainty & financial market disruptions with stronger US dollar and tighter global financing. Major risk of policy moving to protectionism., affecting EMs which rely on trade for development.
- Major central banks to keep low or negative interest rates, except US with gradual tightening
- Global Outlook
- US Economy
- Regional Outlooks
- Weak Investment in Uncertain Times: Causes, Implications and Policy Responses
- All forecast data available here.
- 2016 Growth Growth: 2.3 %
- 2017 Global Growth: 2.7%
- Box 1.2 – good regional summary
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