Forecast updateSchroders Economic Infographic June 2015
Federal Reserve: 2 new risk scenarios
Eurozone: forecast on track
Bother in the BRICs
(2) Tightening tantrum(1) Fed behind the curve
Global growth downgraded after disappointing Q1. Inflation expected to remain low in 2015.
20162.0%
20162.5%
20162.9%
(prev 2.8%) (prev 3.2%)
(prev 1.3%)
(prev 1.6%)
(prev 3.7%)
20164.3%
20161.6%20151.4%
20152.4%
20152.5%
20150.9%
20153.6%
=World U.S.A Europe Japan Emerging
Markets
Austerity to resume = lower growth
Conservative Party election victory
Depreciation in € + rebound in energy prices = inflation positive again
Fastest quarter of growth since Q4 2007
Economy is out of recession
Imports = weighed on total growth
Improved growth outcome due to rise in inventories. Pace may not continue into Q2
ECB buying €60bn of assets per month until Sep'16.
Eurozone recovery is progressing
Germany robust... but French recovery fragile
Inflation surges out of control
Bond markets sell-off inresponse to Fed tightening
Higher global yields hit growth Emerging markets suffer most
Fed delays hike to H2 2016 on growth fears
Responseto fall in energy costsslower than expected
$ remains firm + economy temporarily slows
Austerity + credit conditions ease... weak € + energy prices support activity
Tighter interest rates, firm $ + weak commodities weigh on growth
= 2015 forecast = 2016 forecastSlow start to 2015... however, growth supported by weaker ¥
CHINAINDIARUSSIABRAZIL
Property + manufacturing to struggle.Weak growth = policy easing measures
5.2% 6.2%
2015 2016
7.8%
2016
7.5%
2015
Oil price remains low
Ukraine situationremains tense
More aggressive monetary tightening weighs on growth as consumption fades
Reforms disappoint market... but modest pace should deliver improvements
Gro
wth
fore
cast
2.4%
2.8%
1%
1.6%
2.1%
1.1%
1.2%0.5%
SPAI
N
GERMANY FRANCE ITALY
6.5%
1.4% 2.0%
6.8%
2015 2016 2015 2016
GDP INFLATION
-1.8%0.7%
20152016
5.5%7.9%
2015 2016
GDP
INFLATION-4%2015
15.1%
2015
6.2%
2016-0.1%2016
GDP
INFLATION INFLATIONGDP
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