29 Oct 2015
Global growth rates: downsides persists - Scotiabank
FXStreet (Guatemala) - Analysts at Scotiabank explained that six years and counting, global output growth has been steadily moderating following the massive stimulus-induced bounce in 2010 from the depths of the Great Recession.
Key Quotes:
"This is the opposite of past cycles where recoveries gained momentum on the back of strengthening and more synchronized activity among advanced and developing economies. For the time being, downside risks to growth are still dominating the outlook. The differential economic performances throughout the world are striking. Among the two largest growth engines, the U.S. economy is gradually powering up, while China’s economy is gradually powering down. The U.K. and India are posting relatively solid growth rates, but Brazil and Russia are in deep recession.
Many countries, Canada included, fall into the ‘moderate growth’ performance category, with the negative trade impact of slowing Chinese growth having a greater impact than the positive trade impact associated with the U.S. revival. Low interest rates and low oil prices are helping to underpin global activity, but the generally sluggish behaviour internationally leaves little margin for error if downside risks persist."
Key Quotes:
"This is the opposite of past cycles where recoveries gained momentum on the back of strengthening and more synchronized activity among advanced and developing economies. For the time being, downside risks to growth are still dominating the outlook. The differential economic performances throughout the world are striking. Among the two largest growth engines, the U.S. economy is gradually powering up, while China’s economy is gradually powering down. The U.K. and India are posting relatively solid growth rates, but Brazil and Russia are in deep recession.
Many countries, Canada included, fall into the ‘moderate growth’ performance category, with the negative trade impact of slowing Chinese growth having a greater impact than the positive trade impact associated with the U.S. revival. Low interest rates and low oil prices are helping to underpin global activity, but the generally sluggish behaviour internationally leaves little margin for error if downside risks persist."