10 themes for 2016 – NAB

By FXStreet FXStreet (Guatemala) – As we enter 2016, NAB Economics’ core view is for lacklustre global growth at around 3¼%, despite some of the risks hanging over global markets abating.

Key Quotes:

“In Australia, a gradual recovery is anticipated with real GDP growth increasing modestly to 2¾% as momentum in non-mining activity gathers traction. This is despite the stronger headwinds to national income stemming from lower commodity prices, and a less beneficial mix of global growth for Australia as China and other key markets in Asia slow.”

“As always, risks abound and our forecasts depend critically on the assumptions underpinning them. In this article, we identify 10 global and domestic themes which will have bearing on the economic and financial market outlook:

1. Global monetary policy divergence – Higher US rates, while balance sheet expansion by the ECB and BoJ continues. The RBA will sit on its hands.

2. A turning point for global inflation? Will 2016 be the year that deflationary pressures ease? Much will depend on commodity prices as well as the degree of spare capacity, wages and aggregate demand across the global economy.

3. Global trade slowdown: cyclical or structural? Either way, global trade volumes and prices are likely to remain low as …read more

Source:: FX Street