CESCE, Country Risk
In the latest review of the performance of the global economy, the international organization estimates that GDP growth for 2018 and 2019 will reach 3,7%, two tenths below the forecasts of last April.
Furthermore, unlike what happened in 2017, this growth will be less balanced between regions since some of the risks that were contemplated in April have already begun to materialize, such as the financial turbulence in emerging markets derived from the rise in interest rates. Fed or the trade war between United States and China. By region, the good times that the american economy with GDP growth of 2,9% in 2018 and employment at historic highs, thanks, to a certain extent, to the expansive effect of the tax reform of the Trump administration.
However, the organization has revised downwards the forecasts of the leading world power for 2019 (2,5%) as a result of the cross-imposition of tariffs between United States and the main world powers. Both the Eurozone , the United Kingdom In 2018 they will register lower growth rates than initially expected. In the first case, this is due to the lower dynamism that the main economies of the region have shown (Germany and France, fundamentally) due to temporary factors, such as the heat wave experienced Europe in the first half of the year which caused a drop in productivity. The uncertainty surrounding the exit negotiation process United Kingdom of the community bloc has translated into a lower GDP growth rate in this economy (1,1% in 2018, compared to the 1,3% previously estimated) and a deterioration in economic sentiment and investment dynamism.
Amongst the emerging There is also notable heterogeneity. On the one hand, crude oil producing countries will register higher growth rates as a result of the increase in oil prices (a barrel of Brent is trading above $80). On the other hand, those economies that present greater imbalances and financing needs, such as Turkey or Argentina, will be penalized by the monetary normalization of the Fed, which will result in more moderate GDP growth in 2018. In fact, these countries have already been victims of increased financial instability and strong pressures on their currencies in the current financial year.
Finally, the organization pointed out that the intensification of Trade tensions and political uncertainty that derive from them, represent the main challenges for the global economy in the short term. This will undoubtedly be reflected in a lower dynamism of investment and international trade in 2018 and 2019.
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