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13 May 2015
Currency shifts to widen gap between global economies in 2015 & 2016 - Moody’s
FXStreet (Mumbai) - Divergence between major economies are likely to widen this year and in 2016, according to the ratings agency Moody's, with shifts in capital flows and currency values affecting the global economic outlook and hurting economies vulnerable to negative shocks, like Brazil, South Africa, and Turkey.
Marie Diron, a Moody's Senior Vice President, noted in his report "While prospects of robust growth point to a gradual tightening of monetary policy and higher yields in the US, economic prospects are subdued in many other regions,"
"The outcome is likely to be increased divergence between those economies that have built up resilience, like the US and India, and those that are vulnerable to negative shocks, like Brazil, South Africa and Turkey."
"Moody's forecasts US GDP growth of 2.8% in both 2015 and 2016," "Weaker than expected US growth will have a negative impact on growth in Canada and Mexico, both of which ship around 75-80% of their exports of goods to the US. Slightly lower demand from the US will weigh on their export growth, while lower oil prices are also negative for the two countries,"
"In China, domestic factors will mainly account for economic developments. Moody's maintains its forecast that GDP growth will slow to 6.8% in 2015 and 6.5% in 2016, from 7.4% last year."
Marie Diron, a Moody's Senior Vice President, noted in his report "While prospects of robust growth point to a gradual tightening of monetary policy and higher yields in the US, economic prospects are subdued in many other regions,"
"The outcome is likely to be increased divergence between those economies that have built up resilience, like the US and India, and those that are vulnerable to negative shocks, like Brazil, South Africa and Turkey."
"Moody's forecasts US GDP growth of 2.8% in both 2015 and 2016," "Weaker than expected US growth will have a negative impact on growth in Canada and Mexico, both of which ship around 75-80% of their exports of goods to the US. Slightly lower demand from the US will weigh on their export growth, while lower oil prices are also negative for the two countries,"
"In China, domestic factors will mainly account for economic developments. Moody's maintains its forecast that GDP growth will slow to 6.8% in 2015 and 6.5% in 2016, from 7.4% last year."