Salient to Investors:
Pier Carlo Padoan at OECD said:
- Global economic growth will accelerate at multiple speeds in 2014 with both the US and Japan continuing to outpace the euro area.
- Rising unemployment is the most pressing challenge and euro countries with trade surpluses such as Germany need to allow wages to rise
- Reform fatigue is mounting as visible results in growth and jobs fail to materialize.
- Protracted monetary easing may lead to excessive risk taking, bubbles and resource misallocation. Exit from unconventional monetary policy may be difficult to manage, possibly leading to sharp rises in bond yields and serious negative consequences for growth.
The OECD said:
- US will grow 1.9 percent in 2013 and 2.8 percent in 2014, Japan will grow 1.6 percent in 2013 and 1.4 percent in 2014, and the euro-area economy will contract 0.6 percent in 2013 and grow 1.1 percent in 2014.
- The US has repaired its financial system.
- Japan’s shift to a more stimulative monetary policy is welcome.
- Public debt in many euro-area countries will soon start to decline given the fiscal effort made over several years.
- Combined OECD countries will grow 2.3 percent in 2014 versus 1.2 percent in 2013.
- China will grow 7.8 percent in 2013 and 8.4 percent in 2014.
- An early withdrawal by the Fed could jeopardize the fragile recovery, but waiting too long could result in a disorderly exit.
Read the full article at http://www.bloomberg.com/news/2013-05-29/oecd-sees-global-economy-recovering-next-year-as-europe-lags.html
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