World Economic Outlook Archives - Professor Michael CzinkotaProfessor Michael Czinkota

By Zacks Investment Research | Market Overview
Advanced economies are projected to climb 1.8% in 2014 and 2.4% in 2015. These growth projections are considered crucial for global expansion as well as for the progress of emerging and developing nations. Emerging economies are predicted to grow by 4.6% in 2014 and 5.2% in 2015.

A chart displaying Gross Domestic Product (GDP) of the global economy as well as that of selected developed nations, including the U.S, Japan and the Eurozone, and emerging countries like China, India, Brazil and South Africa is provided below:

GDP Rates

A spur in economic growth inducing more industrial activities is considered favorable for the expansion of the machinery industry. This direct correlation, right on the heels of the expected economic growth worldwide, makes us confident about the machinery industry. Across nations, the level of industrial activities is measured in terms of industrial production — output of the manufacturing, mining and utilities sectors.

A brief discussion on the prospects of the machinery industry in different nations has been provided below.

Prospects in the United States

International trade is on the rise. Export demand for U.S-made goods, especially automotive vehicles and parts, consumer articles, industrial supplies and materials, and food and beverages, increased by roughly $2 billion to $198 billion in July.

The world’s largest economy held nearly 16.5% of the global GDP on purchasing power parity (PPP) basis, in 2013. Over the last five years, the country’s GDP growth movement were in sync with its industrial production. With the IMF anticipating the economy to grow by 1.7% in 2014 and 3% in 2015, one can gather a fair idea about the growth prospects of the machinery industry.

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“We will be revising upwards the global forecast of the economic growth,” she told a press conference in the Nairobi, adding that it would be premature to say any more.

Ms Lagarde, who was wrapping up a two-day visit to Kenya, gave no reason for the revision.

When it issued its latest World Economic Outlook report in October, the IMF lowered its forecasts, saying that global growth “remains in low gear”.

It said it expected the global economy to grow 2.9pc year-on-year in 2013 and 3.6pc in 2014. That represented a downward revision of 0.3 and 0.2 percentage points, respectively, from its July estimates.

Emerging market economies, although still accounting for most global growth, were losing more momentum than previously thought, the IMF said in November, although advanced economies, in particular the US, were showing signs of picking up.

The fact that the US Federal Reserve has started to change the easy-money policy it had been pursuing has had the effect of slowing capital inflows to emerging-market economies as long-term yields in the US and many other economies have risen, Ms Lagarde said.

The IMF chief dined with Kenyan President Uhuru Kenyatta on Monday evening in the coastal city of Mombasa.

Her visit came a month after the final disbursement of a three-year, $750m support loan for Kenya that had backed major restructuring of economic policies and strengthening of the government’s financial position.

article and image source: telegraph.co.uk