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Wednesday, 01 October 14
FITCH: GLOBAL ECONOMY FACES MULTI-SPEED RECOVERY, MULTIPLE RISKS
 Fitch Ratings says in its latest Global Economic Outlook (GEO) that global growth will pick up in 2015 and 2016, but risks are weighted to the downside. The contribution of major advanced economies (MAEs) to global expansion will gradually increase, while growth will remain subdued in emerging markets (EMs) after the cyclical trough this year. Fitch’s latest forecasts for world GDP growth (weighted at market exchange rates) are 2.6% in 2014, accelerating to 3% in 2015 and 3.1% 2016.
The 2014 and 2015 forecasts are both 0.1pp lower than in the June GEO. The downward revisions, similar to previous quarters, are mainly due to emerging markets. For the US economy Fitch maintains its forecast of robust GDP growth of 3.1% in 2015 and 3% in 2016, up from 2.2% in 2014. The economy rebounded strongly in 2Q14 after a temporary setback in 1Q14. Private consumption growth is underpinned by improving household income, wealth and confidence.
Investment should be supported by high corporate cash piles and profitability, low financing costs, rising confidence and capacity utilisation. Monetary policy remains highly accommodative and the drag from fiscal consolidation is significantly smaller than it was in 2013. We forecast eurozone GDP growth of 0.9% in 2014, followed by 1.3% in 2015 and 1.5% in 2016, slightly weaker than in the June GEO. Output stagnated in 2Q14 following four quarters of insipid growth, due primarily to a sharp slowdown in Germany.
Over the forecast horizon growth will be supported by the US and UK recoveries, euro depreciation, ECB policy loosening and an easing in the pace of fiscal consolidation. However, faltering recent outturns suggest deleveraging and structural constraints remain formidable headwinds, eroding potential benefits from improving external conditions or policy stimulus. High unemployment will persist and remain above 11% until 2016. Fitch’s base case is for eurozone inflation to be low at 0.5% in 2014, 1% in 2015 and 1.3% in 2016, but for protracted deflation to be avoided. However, current low inflation, weak demand, a decline in market inflation expectations, policy challenges and the potential for self-reinforcing dynamics make deflation a meaningful and rising risk.
We forecast EM growth to slow sharply from 4.7% in 2013 to 4% in 2014, before recovering somewhat in 2015-16. Looming US monetary policy tightening, geo-political tensions and lower commodity prices pose downside risks. Brazil is now in recession and Russia close to it. Fitch expects both to see only a subdued recovery in 2015 and 2016, underperforming most MAEs over the forecast period.
Fitch expects China’s GDP growth to moderate to 7.2% in 2014, 6.8% in 2015 and 6.5% in 2016 as it gradually rebalances while seeking to contain leverage. India will be the only BRIC country where growth picks up in 2014 to 5.6% and accelerates further to 6.5% in 2015 and 2016, owing to an expected improvement in the business environment.
The underlying momentum of the Japanese economy is uncertain after sharper-than-expected contraction in 2Q14. We have revised down GDP growth to 1.4% in 2014, from 1.6% previously, and are maintaining our forecast of 1.3% for 2015 and 2016. Higher wage growth is central to Japan’s prospects of achieving sustainably higher real and nominal GDP growth. Growth in the UK has been strong and broad-based. Fitch is maintaining its forecast that growth will slow from 3% in 2014 to 2.5% in 2015 and 2.3% in 2016, as it moves to its medium-term potential rate of 2%-2.25%.
The base case is that nominal wage growth will pick up as the labour market slack is absorbed and the currently weak productivity growth will improve, in line with previous cyclical recoveries. The coming quarters will see increasing divergence of monetary conditions in MAEs after six years of synchronised, ultra-loose monetary stance.
Fitch expects the Fed and Bank of England to start gradually tightening policy over the next few quarters. Meanwhile, the ECB announced further easing measures at its September meeting and the Bank of Japan is continuing with its qualitative and quantitative easing strategy. The ECB and Bank of Japan are likely to keep interest rates unchanged until at least 2016. This GEO edition’s alternative scenario explores the global impact of a US interest rate shock. In this scenario the Federal Funds rate increases to 5% and the ten-year US yield reaches 6% by end-2016, triggered by an initial inflation shock as the economy runs out of spare capacity much sooner than policy makers and the markets currently expect.
Furthermore volatility spikes in global financial markets and leads to a 150 bps increase in global risk premium. Growth slows sharply in the US from mid-2015 and the economy stagnates in 2016. According to the simulation results the impact on MAEs is limited and stems mainly from lower US demand. Nevertheless the shock raises the risk of a new recession in the eurozone as the baseline recovery is so weak. In many EMs, central banks tighten monetary conditions due to the higher risk premium and inflation, despite the economic slowdown. Russia and Brazil would remain close to recession in 2015 and 2016, while India would slow sharply and China would be the least affected among the BRICs.
Source: Fitch Ratings
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Sunday, 16 April 23
CHINA JUGGLES FOUR MAJOR ECONOMIC CHANGES IN 2023 - WOOD MACKENZIE
Change is afoot in China. Economic growth is slowing, while rising political tensions between China and the US, coupled with global supply chain re ...
Sunday, 16 April 23
CHINA'S MARCH COAL IMPORTS JUMP TO 3-YEAR HIGH - REUTERS
China’s coal imports surged in March to their highest in any month over the past three years as utilities increased purchases on expectations ...
Sunday, 16 April 23
OPEC KEEPS WORLD OIL DEMAND GROWTH OUTLOOK UNCHANGED
The OPEC Reference Basket (ORB) declined in March by $3.43, or 4.2%, m-o-m to average $78.45/b. The ICE Brent first-month contract fell by $4.33, o ...
Sunday, 16 April 23
CHEAPER SPOT LNG PRICES TEMPT SOME ASIAN BUYERS AMID SUPPLY GAINS - REUTERS
Cheaper spot prices for liquefied natural gas (LNG) are luring price-sensitive buyers back in Asia, with China and India recording rising imports i ...
Tuesday, 11 April 23
COAL USE CLIMBS WORLDWIDE DESPITE PROMISES TO SLASH IT - AAP
The burning of coal for electricity, cement, steel and other uses went up in 2022 despite global promises to phase down the fuel that is the bigges ...
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Showing 106 to 110 news of total 6871 |
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- Coastal Gujarat Power Limited - India
- IEA Clean Coal Centre - UK
- Singapore Mercantile Exchange
- Interocean Group of Companies - India
- Rashtriya Ispat Nigam Limited - India
- Riau Bara Harum - Indonesia
- Mercuria Energy - Indonesia
- Central Electricity Authority - India
- The State Trading Corporation of India Ltd
- Indonesian Coal Mining Association
- Eastern Coal Council - USA
- Medco Energi Mining Internasional
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Standard Chartered Bank - UAE
- Bukit Baiduri Energy - Indonesia
- Meralco Power Generation, Philippines
- Indo Tambangraya Megah - Indonesia
- Cement Manufacturers Association - India
- Uttam Galva Steels Limited - India
- Banpu Public Company Limited - Thailand
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Krishnapatnam Port Company Ltd. - India
- Iligan Light & Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Bhatia International Limited - India
- Directorate General of MIneral and Coal - Indonesia
- London Commodity Brokers - England
- Pendopo Energi Batubara - Indonesia
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Sarangani Energy Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Deloitte Consulting - India
- Makarim & Taira - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Alfred C Toepfer International GmbH - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Lanco Infratech Ltd - India
- Georgia Ports Authority, United States
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Maheswari Brothers Coal Limited - India
- VISA Power Limited - India
- Latin American Coal - Colombia
- Sakthi Sugars Limited - India
- Kobexindo Tractors - Indoneisa
- Commonwealth Bank - Australia
- Merrill Lynch Commodities Europe
- Siam City Cement PLC, Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Indogreen Group - Indonesia
- TeaM Sual Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Thiess Contractors Indonesia
- CIMB Investment Bank - Malaysia
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- The Treasury - Australian Government
- McConnell Dowell - Australia
- Salva Resources Pvt Ltd - India
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Cigading International Bulk Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Electricity Authority, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Simpson Spence & Young - Indonesia
- Vedanta Resources Plc - India
- ASAPP Information Group - India
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- TNB Fuel Sdn Bhd - Malaysia
- Xindia Steels Limited - India
- Bhushan Steel Limited - India
- Orica Australia Pty. Ltd.
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Aboitiz Power Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- SMC Global Power, Philippines
- Meenaskhi Energy Private Limited - India
- Ministry of Transport, Egypt
- Anglo American - United Kingdom
- Edison Trading Spa - Italy
- Kohat Cement Company Ltd. - Pakistan
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Coal and Oil Company - UAE
- Timah Investasi Mineral - Indoneisa
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Global Coal Blending Company Limited - Australia
- Parry Sugars Refinery, India
- Tata Chemicals Ltd - India
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- Attock Cement Pakistan Limited
- Semirara Mining Corp, Philippines
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- Kumho Petrochemical, South Korea
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
- MS Steel International - UAE
- Antam Resourcindo - Indonesia
- Intertek Mineral Services - Indonesia
- Price Waterhouse Coopers - Russia
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Star Paper Mills Limited - India
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Energy Link Ltd, New Zealand
- OPG Power Generation Pvt Ltd - India
- Mercator Lines Limited - India
- Energy Development Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- Sical Logistics Limited - India
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Videocon Industries ltd - India
- South Luzon Thermal Energy Corporation
- The University of Queensland
- Larsen & Toubro Limited - India
- Barasentosa Lestari - Indonesia
- Dalmia Cement Bharat India
- Rio Tinto Coal - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Jaiprakash Power Ventures ltd
- GVK Power & Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Wilmar Investment Holdings
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- Straits Asia Resources Limited - Singapore
- Ambuja Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- Savvy Resources Ltd - HongKong
- Billiton Holdings Pty Ltd - Australia
- Jorong Barutama Greston.PT - Indonesia
- Sree Jayajothi Cements Limited - India
- Africa Commodities Group - South Africa
- Global Green Power PLC Corporation, Philippines
- Mintek Dendrill Indonesia
- Heidelberg Cement - Germany
- Directorate Of Revenue Intelligence - India
- LBH Netherlands Bv - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- Ministry of Finance - Indonesia
- Metalloyd Limited - United Kingdom
- PowerSource Philippines DevCo
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- Kalimantan Lumbung Energi - Indonesia
- Oldendorff Carriers - Singapore
- India Bulls Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Chamber of Mines of South Africa
- Bangladesh Power Developement Board
- White Energy Company Limited
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Bharathi Cement Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Grasim Industreis Ltd - India
- Siam City Cement - Thailand
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