Global economy recovering: Top international economist

The business cycle is warming up. Whether it was banking, trucks and autos, chemicals, mining, energy or construction, optimism was clear

GN Bureau | January 24, 2017


#world economic forum   #global economy   #Global Financial System Initiative  


For the first time in more than a decade we have a reasonably broad based recovery in the global economy, said Anders Borg, chair, World Economic Forum’s Global Financial System Initiative.
 
In an article “Davos download: global economic warming”, which is part of the World Economic Forum Annual Meeting 2017, Borg said that the business cycle is warming up. Whether it was banking, trucks and autos, chemicals, mining, energy or construction, optimism was clear.
 
Macro-forecasts seem to be in line with business sentiment and the projections of growth in the US are being revisited upwards. The IMF is raising the forecast for 2017 for the USA (2.3%), Germany (1.5%), UK (1.5%), Japan (0.8%) and China (6.5%). Other forecasters are actually even more optimistic about growth in the USA and expect GDP-growth to get closer to 3% for the first time in a decade. The fall of the pound sterling helps the UK and the banking crises in Europe are starting to abate.
 
China and India are continuing to print high numbers and Russia and Brazil are getting closer to dry land. For the first time in more than a decade we have a reasonably broad based recovery in the global economy, said Borg.
 
 
The article went on to say that for the rest of Asia, the Donald Trump administration is reinforcing the ongoing re-balancing towards China. Many Asian countries already have an export share with China of 20-30%. When the USA is retreating and is being perceived as an unreliable partner the only alternative is to strengthen the relationship to Beijing. This would inevitably have happened over the next coming decades, but Trump has fast-forwarded the development.
 
The banking sector has been a major drag on growth in Europe. The recovery of the stock prices the last couple of months comes on the back of raising interest rates, somewhat stronger demand and somewhat lower uncertainty concerning how Italy will deal with the non-performing loans. The new administration in the US will also mean that the Basel-process will going much slower and it is unlikely that the US will sign up to any international agreement on further tightening of capital requirements. In the short term this will push bank stocks further upwards also in Europe. In the long run another banking crisis has become much more likely. This time will not be different.
 
Read: The complete article here 

Comments

 

Other News

Tech firm, telcos prepare to enter 5G era

As the government is set to roll out the 5G spectrum auction, the network providers are also equipping 5th generation network-ready LTE technology.  According to the government, the technology would have an impact of more than $1 trillion on the Indian economy. It is also expected to transform educati

On a personal note: Rabbi Shergill

Punjabi singer, songwriter, and guitarist, Rabbi Shergill rose to fame in 2004 with his chartbuster song ‘Bullah Ki Jaana’ from his debut album ‘Rabbi’. Inspired by rock and Punjabi folk music, he uses Punjabi language to create acoustic rock-based ballads. His poetic and social

NALCO registers Rs 589 crore operating profit in Q3 of 2018-19 FY

National Aluminium Company Limited (NALCO), country’s leading manufacturer and exporter of alumina and aluminium, has posted an operating profit of Rs 589 crore in Q3 of 2018-19 FY, registering 80 percent growth over the same period of last year.   Net profit of the company

Many electronic companies still have no take-back system: Report

In 2016, 44.7 million tonnes of e-waste was generated globally which is expected to increase to 52.2 million tonnes in 2021. As of 2016, it was found out that India is the second and fifth highest generator (in Asia and globally respectively) of e-waste with 2 million tonnes. The mounting pile of e-waste h

India’s per capita power consumption likely to grow by two fold, says power minister

Union power minister RK Singh has said the per capita current power consumption of 1,200 units is expected to grow 2-3 times at par with the international consumption after every Indian gets access to electricity. Singh said the power sector is witnessing an increased demand which is further expect

Net profit of Rs 616 crore posted by SAIL in Q3 of 2018-19

SAIL has posted a profit (profit after tax) of Rs 616 crore in Q3 of 2018-19 FY. SAIL has managed to better its performance over the previous quarter as well by more than 11 percent when it stood at Rs 554 crore. The turnover for Q3 FY’19 improved by three percent over corresponding period of

Current Issue

Current Issue

Video

CM Nitish’s convoy attacked in Buxar

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter