Global economic recovery ‘in danger of stalling’
"The world economy is beset by feeble growth and a recovery that is “weak, uneven and in danger of stalling yet again,” according to the latest Brookings Institution-Financial Times tracking index.
In a publication ahead of the spring meetings of the International Monetary Fund and World Bank this week, the index provides sober reading, highlighting sluggish capital investment, falling industrial production and declining business confidence.
The results of the index are likely to be reflected in IMF forecasts for the global economy on Tuesday, prompting Christine Lagarde, fund managing director, to warn of the need to be “alert”to global risks with growth “too low for too long”. The IMF is widely expected to revise its 3.4 per cent forecast for growth in 2016 down again.
According to Professor Eswar Prasad, an economist at Brookings, the worst fears of a financial and economic crisis in January and February “might be over but after yet another year of tepid growth in 2015, the world economy in 2016 faces the unsettling prospect of more of the same”."
Feeble indeed. We have discussed this issue before and will likely need to return to it again. The global economy is in poor shape, and while China has once again convinced the talking heads it is out of the storm, there is no economic evidence of this.
"Most positive economic news is currently coming from the US, where employment, retail sales and credit growth remains strong despite faltering business confidence. Eurozone indicators are generally a little stronger in 2016 than last year, although investment, retail sales, and consumer confidence remain weak across the bloc, raising concerns about the sustainability of the recovery.
The UK has also held up, although investment, business confidence and industrial production appear to be suffering from uncertainties caused by the June referendum on EU membership."
The article selects only the few positive US economic indicators but fails to note or discuss the myriad negative indicators. Sigh. And while the Eurozone is overall doing better in 2016 than 2015, that is not saying much. Spain, Portugal, Italy, Greece, and France all have bad unemployment stats. They may be better this year than last in some of these countries, but still these stats, especially the ones about under 35 unemployment are shocking in most of the southern European countries.
Here is a round up from a recent post.