Global Economy Updates

May 8th, 2016 Posted in Canada|Global Economy

World Economy

World Economy

The recent global economic outlooks provided by IMF forecast a grim picture for the upcoming months. The global economy will continue to recover, but at a slower and fragile pace.

Due to uncertain growth and confidence, advanced economies have deteriorated economic growth in the near future. Also, due to declines in commodity and prices, emerging economies will continue to suffer along with commodity-exporting countries.

As China is moving towards an economic growth based on consumption and services, there will be spills along the way that could affect other countries, especially emerging markets and developing economies. Emerging markets also suffer from slowing capital inflows and accelerating outflows.

Countries should emphasize accommodation monetary policies supplemented by complementary fiscal policies to boost economic growth and output.

However, another report published by Oxford Economies indicated that the global economy is no longer likely to fall into a full recession due to a surge in the global stock market, stable oil prices, and surging commodity prices. Economy health is at a better position now than it was in early January when oil prices were heading towards $20 a barrel and the stock market was in a free-fall.

The US Federal Reserve also keeps maintaining its current interest rate until at least June. Faith in the strengthening US economy makes the Fed believe that evolving economic conditions will make it possible to increase interest rates gradually in the future.

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