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Growth forecasts downgraded again

Published Tuesday, October 7th, 2014

Oil demand forecasts will have to be downgraded again. In the lead up to this week’s IMF and World Bank meetings in Washington both organisations have revised their GDP growth forecasts. We are still waiting for the details but the IMF global growth forecast is expected to have been cut to just above 3% for this year.

Considering that in only January they were forecasting global growth at 3.7% which was then cut to 3.4%, the deterioration is discomforting to say the least. The World Bank has cut Chinese growth to 7.4% this year, to 7.2% in 2015 and to 7.1% in 2016. For the developing East Asia and Pacific region as a whole it has cut growth to 6.9% this year and next, from 7.1% in its last forecast.

Der Spiegel reports that the IMF has cut German growth to 1.5% this year and “actuals” explain why. German industrial orders in August experienced their biggest fall since 2009, falling 5.7%. Industrial output in the month also posted its largest fall for five-and-a-half years, down 4% month-on-month against a Reuters poll forecast of -1.5%.

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Posted by David Hufton