Global Economy Watch - Projections

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Economic projections

Our 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.
 

May 2019

  Share of 2017 world GDP Real GDP growth Inflation 
  PPP MER 2018e 2019p 2020p 2021-25p 2018p 2019p 2020p 2021-25p
Global (Market Exchange Rate ("MER")   100.0% 3.2 2.8 2.8 2.8 3.0 2.3 2.7 2.6
Global (Purchasing Power Parity ("PPP") rate) 100.0%   3.7 3.4 3.5 3.4 3.4 2.8 3.1 3.0
G7 30.6% 46.0% 2.1 1.7 1.5 1.5 2.0 1.6 2.1 2.0
E7 37.6% 26.6% 5.3 5.1 5.3 5.1 3.5 3.7 3.7 3.7
                     
United States 15.3% 24.3% 2.9 2.4 1.8 1.8 2.3 1.8 2.3 2.2
China 18.2% 15.0% 6.6 6.3 6.2 5.9 2.1 2.4 2.7 2.9
Japan 4.3% 6.1% 0.6 1.0 0.3 0.6 1.0 0.9 1.7 1.2
United Kingdom 2.3% 3.3% 1.3 1.2 1.5 1.8 2.5 1.8 2.0 2.0
Eurozone 10.2% 13.9% 1.7 1.1 1.6 1.5 1.6 1.4 1.8 2.0
France 2.2% 3.2% 1.6 1.2 1.5 1.8 1.9 1.4 1.7 1.9
Germany 3.3% 4.6% 1.4 0.7 1.6 1.4 1.7 1.4 2.0 2.3
Greece 0.2% 0.3% 1.9 2.0 2.2 1.5 0.6 0.7 1.5 1.8
Ireland 0.3% 0.4% 6.8 3.4 3.7 3.0 0.5 1.0 1.5 1.9
Italy 1.8% 2.4% 0.8 0.1 0.9 0.8 1.1 0.9 1.5 1.7
Netherlands 0.7% 1.0% 2.5 1.6 2.3 1.9 1.7 2.3 1.8 2.0
Portugal 0.2% 0.3% 2.1 2.0 1.5 1.3 1.1 1.7 1.7 2.0
Spain 1.4% 1.6% 2.5 2.3 1.8 2.0 1.7 1.5 1.9 1.9
Poland 0.9% 0.7% 5.2 3.8 3.0 3.0 1.9 2.0 2.5 2.5
Russia 3.2% 1.9% 1.7 1.5 1.8 1.5 4.0 4.5 4.8 4.7
Turkey 1.7% 1.1% 0.4 -1.5 2.6 2.4 16.3 17.1 14.2 13.0
Australia 1.0% 1.7% 2.8 2.2 2.7 2.8 1.9 2.1 2.3 2.5
India 7.4% 3.3% 7.1 7.3 7.5 7.7 2.1 4.2 4.8 5.0
Indonesia 2.6% 1.3% 5.2 5.2 5.1 5.2 3.2 3.4 3.9 3.0
South Korea 1.6% 1.9% 2.7 2.5 2.8 2.8 1.6 1.4 1.6 2.0
Argentina 0.7% 0.8% -2.4 -1.3 2.0 2.8 46.0 - - -
Brazil 2.6% 2.6% 1.3 1.9 2.2 2.2 3.7 3.5 4.0 4.0
Canada 1.4% 2.1% 1.8 1.6 1.8 1.7 2.2 1.8 2.0 1.9
Mexico 1.9% 1.4% 2.1 2.3 2.7 2.7 4.8 3.5 3.0 3.0
South Africa 0.6% 0.4% 0.8 1.3 1.7 1.8 5.3 4.8 5.4 5.5
Nigeria 0.9% 0.5% 2.0 2.5 2.5 2.5 16.3 11.9 13.0 14.0
Saudi Arabia 1.4% 0.9% 2.1 1.8 1.9 2.1 3.4 2.8 3.1 3.0

Sources: PwC analysis, National statistical authorities, Datastream and IMF. All inflation indicators relate to the Consumer Price Index (CPI). 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. UK and Ireland numbers are contingent on a reasonably smooth Brexit.

Interest rate outlook of major economies

May 2019

 

Current rate (Last change)

Expectation

Next meeting

Federal Reserve

2 - 2.25% (December 2018)

No rate rise in 2019

June 18-19

European Central Bank

0.00% (March 2016)

No rate rise in 2019


June 6

Bank of England

0.75% (August 2018)

One rate rise in the second half of 2019

June 20

Chart of the month

May 2019

Global energy-related CO2 emissions rose to 33.1 gigatonnes (Gt) in 2018, from 32.6 Gt in 2017, according to the IEA. Emissions growth was flat in 2014-16 which gave hope to the idea that they had peaked. In simple terms, emissions rose because the increase in energy demand growth was greater than the decrease in the carbon intensity of that energy.

The IEA’s explanation relies on a counterfactual that economic growth drives emissions growth and relies on hypothetical ‘reductions’ in emissions from energy efficiency and renewables. In reality, energy efficiency is a driver of economic growth, and some countries, such as the UK, have shown it is possible to decouple economic growth and emissions growth. Renewables only reduce emissions if they supplant fossil fuel based generation, which is rarely the case in emerging markets.

As part of joining the WTO, China committed to significantly reduce its average tariff rate levels. However, these tariff reductions mainly impacted China’s merchandise trade

Recently the Chinese leadership has signalled its intent of opening up to foreign ownership some of its service sectors.

We will be monitoring these developments for any changes in the foreseeable future.

As part of joining the WTO, China committed to significantly reduce its average tariff rate levels. However, these tariff reductions mainly impacted China’s merchandise trade.

Recently the Chinese leadership has signalled its intent of opening up to foreign ownership some of its service sectors.

We will be monitoring these developments for any changes in the foreseeable future.

As part of joining the WTO, China committed to significantly reduce its average tariff rate levels. However, these tariff reductions mainly impacted China’s merchandise trade.

Recently the Chinese leadership has signalled its intent of opening up to foreign ownership some of its service sectors.

We will be monitoring these developments for any changes in the foreseeable future.

Contact us

Mike Jakeman

Senior Economist, PwC United Kingdom

Tel: +44 (0)7483 361717

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