Developed or developing, all countries should prepare for “fasten their seatbelts” in the coming months. Considerate a period of adjustment to lower commodity prices and rising interest rates in the United States, the World Bank lowered its global growth forecast for this year to 2.8% against 3% forecast in January.
The forecast 2015 for developing countries has been lowered to 4.4% against 4.8% in January, in particular to take into account the expected recessions in Brazil and Russia . For the United States, the World Bank now expects 2015 growth of 2.7%, half a point lower than at the beginning of the year and 2.8% next year, against 3% .
The impact of lower oil underestimated
In its new World Economic Outlook, the Washington-based institution said that the weakness of commodity prices, and including 40% fall in oil prices over the past year, more than expected penalized exporters of commodities
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Meanwhile, the Chief Economist, Kaushik Basu, believes the Fed should wait for 2016 to start raising interest rates in order to avoid worsening volatility exchange rate and hamper global growth.
Weather Forecast maintained for the next two years
“If we advise the Fed, I would recommend that (rising rates interest) take place next year and not at the end of this year, “, due to mixed economic context, said Kaushik Basu, stating that it was an opinion personal and not that of the whole of the World Bank.
However, he added that the decline in commodity prices should ultimately benefit global growth. The Bank also maintains its 2016 growth forecasts to 2017.
(With Reuters)
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