In it's annual economic predictions list for 2010r, IHS Global Insight (www.ihsglobalinsight.com), says the U.S and world economies have emerged from recession, and the recovery process has begun.
Unfortunately, for most developed economies, this just does not feel like a recovery yet. While there are reasons to believe (policy stimulus, improved financial conditions, and pent-up demand), there are reasons to disbelieve (rising unemployment rates, lingering hangovers from housing bubbles and the financial crisis, and the likely winding down of fiscal stimulus).
IHS says global GDP will grow only 2.8 percent in 2010, well below the 3.5 – 4.0 percent trend rate of growth for the world economy. As expected, IHS says that most emerging markets, particularly Asia, will outpace the developed economies next year. Here’s the list of Top 10 predictions.
- The U.S recovery will start slowly.
- Europe and Japan will rebound even more slowly than the U.S.
- Most emerging markets – especially in Asia – will outpace developed economies.
- Interest rates in the G-8 economies will remain very low.
- Fiscal stimulus will begin to ease.
- Commodity prices will move sideways.
- Inflation will (mostly) not be a problem.
- After improving for a while, global imbalances will worsen again.
- The dollar may strengthen a little, but it is on a downward glide path.
- The risk of a “hard W” is still uncomfortably high.
Here’s a video of IHS Chief Economist Nariman Behravesh delivering the top 10 list.
For more information, access the press release IHS Top 10 Economic Predictions for 2010: Emerging Markets Will Outpace Developed Economies –