Global Economy Watch - Projections

Economic projections: February 2017

Our monthly economic projections table summarises our main scenario GDP and inflation projections. We also assess the interest rate outlook for the US, the UK and the Eurozone.

 

 

Share of 2016 world GDP Real GDP growth Inflation 
  PPP MER 2016e 2017p 2018p 2019-2023p 2016e 2017p 2018p 2019-2023p
Global (Market Exchange Rates)   100% 2.5 2.9 3.0 3.0 1.9 2.7 2.6 2.5
Global (PPP rates) 100%   2.9 3.4 3.5 3.5 2.5 3.1 3.0 2.9
G7 31.5% 46.4% 1.4 1.7 1.9 1.9 0.9 1.9 2.1 1.8
E7 36.2% 25.9% 4.6 5.2 5.1 5.0 1.6 3.5 3.8 3.3
                     
United States 15.8% 24.5% 1.6 2.2 2.4 2.3 1.3 2.3 2.5 2.0
China 17.3% 15.2% 6.5 6.5 6.1 5.7 2.0 1.8 2.5 2.8
Japan 4.2% 5.6% 0.6 0.5 0.7 0.8 0.1 1.3 1.5 1.5
United Kingdom 2.4% 3.9% 1.8 1.5 1.5 2.1 0.7 2.3 2.8 2.3
Eurozone 12.0% 15.8% 1.6 1.5 1.6 1.5 0.2 1.4 1.3 1.4
France 2.3% 3.3% 1.4 1.5 1.6 1.6 0.3 1.2 1.1 1.2
Germany 3.4% 4.6% 1.7 1.4 1.5 1.4 0.4 1.8 1.9 1.7
Greece 0.3% 0.3% -1.0 0.5 1.3 1.6 -0.3 0.5 0.8 1.1
Ireland 0.3% 0.4% 4.0 3.3 3.0 2.6 -0.1 0.8 1.3 1.5
Italy 1.9% 2.5% 0.9 1.0 1.1 1.2 0.2 1.1 0.8 1.4
Netherlands 0.7% 1.0% 1.6 1.6 1.8 1.8 0.8 1.5 1.1 1.3
Portugal 0.3% 0.3% 1.2 1.2 1.1 1.1 0.6 1.0 1.0 1.4
Spain 1.4% 1.6% 2.6 2.3 1.9 2.0 -0.4 1.3 1.1 1.2
Poland 0.9% 0.6% 3.6 3.4 3.2 3.5 -0.3 1.2 1.7 2.4
Russia 3.3% 1.8% -1.6 1.0 1.1 1.5 7.3 5.6 4.8 4.0
Turkey 1.4% 1.0% 3.1 2.9 3.2 3.4 7.7 8.1 8.4 7.0
Australia 1.0% 1.7% 3.1 2.7 2.9 2.7 1.5 2.5 2.4 2.5
India 7.0% 2.8% 7.3 7.3 7.7 6.5 5.1 5.0 5.3 5.0
Indonesia 2.5% 1.2% 5.0 5.1 5.5 5.4 3.6 4.5 4.4 5.1
South Korea 1.6% 1.9% 2.7 2.6 2.8 3.3 1.0 1.6 2.8 3.3
Argentina 0.8% 0.9% -2.2 1.9 2.4 2.5 - 25.0 - -
Brazil 2.8% 2.4% -3.6 0.4 1.5 3.0 8.8 5.0 4.5 4.5
Canada 1.4% 2.1% 1.3 1.9 2.1 2.2 1.5 1.9 2.0 2.0
Mexico 2.0% 1.6% 2.0 1.8 2.1 3.0 2.8 3.4 3.0 3.0
South Africa 0.6% 0.4% 0.5 1.0 1.7 3.0 6.3 6.0 5.7 5.5
Nigeria 1.0% 0.7% -1.0 0.9 2.4 4.2 15.6 14.2 12.0 12.0
Saudi Arabia 1.5% 0.9% 1.0  1.2  2.0  3.5  4.0  3.2  3.0  2.5 

Sources: PwC analysis, National statistical authorities, Datastream and IMF. All inflation indicators relate to the Consumer Price Index (CPI). Argentina has recently launched a new CPI measure, which only contains data from April 2016. Therefore we only project inflation for 2017, and will provide 2018 and 2019-2023 projections once a longer series is available. Note that the tables above form our main scenario projections and are therefore subject to considerable uncertainties. We recommend that our clients look at a range of alternative scenarios. 

 

Interest rate outlook of major economies 

  Current rate (Last change)          Expectation Next meeting
Federal Reserve 0.5-0.75% (December 2016)      Further gradual lightening over the next year   14-15 March
European Central Bank 0.0% (March 2016)      No rate rise for the foreseeable future 9 March
Bank of England 0.25% (August 2016)      No change in rates expected in the short-term 16 March

 

 

 

Chart of the month

Q4 data for 2016 revealed UK employment hit an all-time high of 74.6%, driven by record numbers of working women at 70%, as well as a fall in part-time work.

But we are not seeing these improvements in the job market feed through to earnings growth. Last month, UK inflation rose to 1.8% - the highest rate for two-and-a-half years, while nominal earnings growth slowed at the end of 2016.

 



 

 

 

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Barret Kupelian
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