IMF Global Growth Prediction Stabilizes While U.S. Predictions Suffer
- The International Monetary Fund (IMF) updated its predictions for global growth for 2016 and 2017 last week. The IMF left its predictions for global growth at 3.1 percent for 2016 and 3.4 percent in 2017, but cut its predictions for U.S. growth to 1.6 percent for 2016 from 2.2 percent. (The IMF predicts U.S. growth will return to 2.2 percent in 2017.) The IMF also dropped its predictions for Canada, from 1.4 percent to 1.2 percent for 2016 and from 2.1 percent to 1.9 percent for 2017. The IMF raised its growth predictions for Japan and Britain and kept its predictions for the Chinese economy the same.
- The German government announced last week that the number of industrial orders in the country increased one percent from July to August, more than double the 0.4 percent increase analysts had predicted. The number of domestic orders rose 2.6 percent while orders to non-Eurozone countries fell 2.8 percent. (Orders to Eurozone countries increased 4.1 percent.)
- The JP Morgan global purchasing managers’ index (PMI) rose to 51.0 in September from 50.8 in August. According to the bank, “September PMI data pointed to subdued growth in the U.S. and Asia. The U.S. PMI dipped to a three-month low, while readings for China and Japan moved only slightly back above the stagnation mark of 50.0. Downturns continued in France, South Korea, Turkey, Malaysia, Thailand, Myanmar and Brazil.” The Markit PMI for the Eurozone, meanwhile, rose to 52.6 in September from 51.7 in August as growth in Germany and Austria expanded, Italy returned to expansion, and France stabilized. The Markit report for the United Kingdom also improved, to 55.4 in September from 53.4 in August. India’s PMI fell to 52.1 in September from 52.6 in August even though new orders and output levels expanded. As a reminder, all PMI readings can be found here.