An Opalesque column for global macro investors.
Benedicte Gravrand, Opalesque Geneva:
Financial markets have been on the road to recovery, but real economy has not, says Fitch Ratings, a global rating agency, in its latest Global Economic Outlook Special Report. In the fourth quarter of 2012 (Q412), the Eurozone and the U.S. had the weakest quarterly GDP growth since 2009. Meanwhile, spreads on risky assets tightened and some stock markets peaked.
Fitch forecasts economic growth of 1% in 2013 and 1.9% in 2014 for major advanced economies, 4.7% and 5% for emerging markets, and 2.2% and 2.8% globally.
In the U.S., real GDP grew by 0.1% (annualised) in Q412, disappointing higher expectations. This was a deceleration from Q312 (3.1%), and largely due to a sharp downturn in federal and especially defence spending and private inventories, according to Fitch. However, consumer spending, residential corporate investment, and the labour market remained reasonably healthy in Q412. Fitch revised down its 2013 forecast because of Q412 and also because of "additional headwinds from the $85bn (0.5% of GDP) automatic spending cuts that come into effect on 1 March (the sequester)." The GDP forecast for the U.S. is 1.9% in 2013 and 2.8% in 2014. Fitch expects consumer spending to remain resilient, unemployment to remain above 6.5%, and the Fed to maintain its monetary stance (asset purchases and low rates) until the end of 2014.
In Japan, ......................
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