74515
Outlook for Global Economy, Equity Markets Brighter
Outlook for Global Economy, Equity Markets Brighter

Outlook for Global Economy, Equity Markets Brighter

Outlook for Global Economy, Equity Markets Brighter

Ebrahim Rahbari remains positive on the global economy and equity markets for now. The head of global macro­economics at Citi expects growth to accelerate in the near term as people finally shake off the gloom associated with the last financial crisis.
While the global economy may be near “peak momentum” and asset valuations are “stretched”, growth is strong and broad-based across most developed markets and many emerging markets. Moreover, Citi expects a pick-up in capital investment globally and faster US growth stemming from Donald Trump’s plans for tax cuts, AAP reported.
“The most remarkable part of this upturn, the current improvement in global growth, is that we are finally seeing investment come through,” Rahbari said at the Citi Investment Conference in Sydney Tuesday. “We could have a bit of upside in economic growth rates both globally and in the US.”
He expects the “end of pessimism” to inspire a return of capex spending in the industrial sector. “It’s more driven by the fact that we’ve stopped getting ever more worried about the outlook and we’ve kind of converged to the ‘new normal’ in a way that actually underpins a little bit of additional investment spending,” Rahbari said.
“My guess is, near term, we have a little bit of upside risk in economic growth but we are probably not far from the peak of the momentum.”
Citi predicts global growth of 3% to 3.5% next year—which is “unremarkable” compared with just before the crisis but “respectable” compared with long-term averages.
“What strikes us as most unusual in this current pattern is how broad-based the recovery is and how few risks we are seeing that some significant part of the world is facing a slowdown in the near future,” Rahbari said. “It’s a very broad-based and perhaps there are some upside risks.”
In recent years the eurozone was viewed as a key risk to the global outlook. “We were often worried that things could fall apart (in the EU)—that either the economy would struggle to recover or that there would be a significant crisis in financial markets.
“But the eurozone is now among regions that are doing well and it has in fact outgrown the US economy for the last couple of quarters and there’s every expectation that this will continue for some time.”
In his view that’s also true for the other big laggard—Japan.

Short URL : https://goo.gl/eXTzTs
  1. https://goo.gl/BsrHoH
  • https://goo.gl/Pi49Jw
  • https://goo.gl/97cAcQ
  • https://goo.gl/RPC9JJ
  • https://goo.gl/5izS9L

You can also read ...

World GDP is expected to advance 3.5% in 2017—its best year since 2011—and 3.7% in 2018.
Nearly 10 years after the financial crisis brought the global...
The OECD believes that tax evasions cost governments around the world as much as $240 billion a year in lost revenue.
They have revolutionized the way people live, but are US tech...
Supporters of EU-Mercosur Free-Trade Pact Push for Deal
Supporters of a free trade pact between the EU and the...
Few Signs of Progress in NAFTA Talks
Negotiations in Mexico to update NAFTA have not made much...
Kuwait Needs $100b Over 5 Years to Cover Deficit
Kuwait will need $100 billion of additional financing over the...
China to Help Shortfalls in Pension Funds
China on Saturday announced a pilot program to help pension...
Goldman Predicts Four Rate Hikes in US
The US economy is heading into 2018 with strong momentum that’...
Emmanuel Macron (L), French Labor Minister Muriel Penicaud (C) and Jean-Claude Juncker.
The EU is trying to present itself as more socially just,...

Add new comment

Read our comment policy before posting your viewpoints

Image CAPTCHA
Enter the characters shown in the image.

Trending

Googleplus