Prospects for the global economy to end-2016

2016 ◽  
Keyword(s):  
Euro Area ◽  
Emerging Economies ◽  
Global Economy ◽  
Commodity Prices ◽  
Content Type ◽  
Area Growth ◽  
Recent Trends ◽  
Global Growth

Subject Prospects for the global economy to end-2016. Significance Global growth could accelerate in the second half of 2016. Some emerging economies are facing better conditions thanks to the weaker dollar and some rebound in commodity prices, while others remain in recession. US growth slowed in the first quarter, while Japan's government just avoided a relapse into recession. Euro-area growth is robust compared to its recent trends, but cannot be relied upon to provide much support for the rest of the global economy.

Policy doubts will keep Turkish assets under strain

2018 ◽  
Keyword(s):  
Emerging Economies ◽  
Global Economy ◽  
Local Elections ◽  
Economic Adjustment ◽  
Content Type ◽  
Inflation Rates ◽  
Retail Investors ◽  
Equity Funds ◽  
Monetary And Fiscal Policy ◽  
Global Growth

Subject The relief rally in Turkish assets. Significance The lira has risen despite the continued strength of the dollar, suggesting that Turkey’s tighter monetary and fiscal policy is paying dividends. However, these policies have also brought about a sharp economic adjustment, causing output to contract on a quarterly basis in the third quarter, increasing the risk of a premature loosening of policy ahead of local elections in March. Impacts Plunging oil prices will help suppress inflation rates in advanced and emerging economies but raise concerns that global growth is slowing. Investors will become increasingly concerned about the health of the global economy and the risk of a Fed policy mistake. Retail investors will remain risk-averse, as EM bond and equity funds continue to suffer outflows.

Determinants of stock market reaction to cross-border acquisitions: evidence from emerging economies

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Samta Jain ◽  
Smita Kashiramka ◽  
P. K. Jain
Keyword(s):  
Emerging Economies ◽  
Value Creation ◽  
Global Economy ◽  
Emerging Market ◽  
Research Work ◽  
Abnormal Returns ◽  
Content Type ◽  
Cross Border ◽  
Country Level ◽  
Acquiring Firms

PurposeThe global economy has witnessed an exponential increase in cross-border acquisitions (CBAs) by emerging market companies (EMCs), demanding a relook at their internationalization strategy. The purpose of the study is to investigate whether the announcement of CBAs by EMCs creates value for the equity-holders of acquiring firms and identify factors affecting the valuation of acquiring companies.Design/methodology/approachThe paper investigates the announcement impact of CBAs of CNX Nifty 500 Indian and SSE 380 Chinese companies. The event study analysis of 553 Indian and 125 Chinese acquisitions supports the contention that CBAs are indeed a strategic choice of EMCs for value creation.FindingsCBAs generate positive and statistically significant abnormal returns for shareholders of both Indian and Chinese acquirers. The markets, however, differ in terms of their motivations; country-level factors have been observed to exert significant influence on the returns of Indian acquirers. Indian companies experience larger value creation on acquiring firms established in developed, institutionally closer and/or economically distant markets. The findings support the asset-seeking motive of Indian companies.Originality/valueThe research work contributes to the evolving stream of CBAs literature with a focus on the globalization strategies of EMCs. The present study is a modest attempt to lay the foundation for a new theoretical framework (asset-seeking perspective) of overseas acquisitions from emerging economies. The existing studies on emerging economies have emphasized, in isolation, either Indian CBAs or international acquisitions by Chinese firms. Being so, the study is unique and original in the sense that it is a comparative study of India and China.

Global rebalancing to support sustainable growth

2015 ◽  
Keyword(s):  
Global Economy ◽  
Oil Prices ◽  
Sustainable Growth ◽  
Low Energy ◽  
Energy Prices ◽  
Current Account Surplus ◽  
Content Type ◽  
Percentage Points ◽  
Advanced Economies ◽  
Global Growth

Significance Risks to its central scenario are more balanced and less skewed to the downside. Global imbalances are shrinking, partly thanks to low oil prices. This is boosting disposable income in oil-importing countries at the expense of oil-exporting ones. The dollar's strength is also helping rebalance the global economy, although the euro-area's growing current account surplus is contentious. Impacts Disinflation has become widespread, especially within advanced economies, but should be temporary. Low energy prices are estimated to add between 0.5-1.0 percentage points to global growth by 2016. A revision of guidelines and rules is required to reduce the risk of another financial crisis.

Export diversification augurs well for Europe's growth

2015 ◽  
Keyword(s):  
Euro Area ◽  
Export Diversification ◽  
Content Type ◽  
Long Run ◽  
Area Growth ◽  
Growth Prospects

Subject The diversification and quality of European exports. Significance For all the gloom about Europe's economy, one fact stands out: the continent is a proficient exporter. This is not just true of Germany, the biggest exporter in Europe and the world's third-largest exporter overall. Half of the world's top-ten exporters are European. Impacts Export prowess suggests Europe's long-run growth prospects remain good. This finding is independent of the currency fortunes of individual members or the region. This supports a more bullish view on the euro-area growth prospects than currently foreseen.

Global growth and market prospects may improve in 2016

2016 ◽  
Keyword(s):  
Commodity Prices ◽  
Equity Markets ◽  
Commodity Price ◽  
The United States ◽  
Real Economy ◽  
Content Type ◽  
Positive Effects ◽  
New Energy ◽  
Growth Prospects ◽  
Global Growth

Subject Correlation between oil prices, equity markets and global growth. Significance Weak global growth and volatile equity markets in early 2016 illustrate how the real economy and distressed investors are struggling with rapid changes in such key parameters as the new energy and commodity price regime. This is because the 'losers' have to react quickly, plunging economies into recession before the 'gainers' generate any positive effects. These asymmetries, along with disappointing data, are spooking stock markets into a broad-based sell-off. After a nearly 10% fall in global equities between end-December and mid-February wiped as much as 6-7 trillion dollars off wealth, markets have rallied, especially in the United States, where key indices have recouped losses to trade at levels last seen at end-2015. Impacts A recovery in global growth prospects could emerge by mid-2016, stabilising commodity prices and underpinning gains in equity markets. Distressed sales of assets should abate and have less influence on markets. Easing fears over China will help markets rebound after the panic attack in early 2016. The consumer benefits of low energy and food costs have disappointed, but there could be higher spending throughout 2016.

Prospects for the global economy in the fourth quarter

2015 ◽  
Keyword(s):  
Interest Rates ◽  
Global Economy ◽  
Fourth Quarter ◽  
Content Type ◽  
Bank Of China ◽  
Policy Interventions ◽  
The Us ◽  
Global Demand ◽  
Global Growth ◽  
China’S Economy

Subject Prospects for the global economy in the fourth quarter. Significance Three threats are on the horizon. Firstly, the US Federal Reserve (Fed) might raise interest rates this year. This move, though well signalled, may have negative repercussions, especially in emerging markets (EMs). Secondly, China's economy, a key to global growth, is slowing and its financial markets are exceptionally volatile. These factors have already elicited policy interventions such as renminbi depreciation and further rate cuts by the People's Bank of China (PBoC). Finally, there is no apparent end in sight to weak global demand and the fall in commodities prices that has left commodity-exporting countries struggling with precipitous drops in revenue.

Prospects for emerging economies to end-2016

2016 ◽  
Keyword(s):  
Fiscal Policy ◽  
Exchange Rates ◽  
Emerging Economies ◽  
Federal Reserve ◽  
Emerging Market ◽  
Commodity Prices ◽  
Content Type ◽  
Political Risks ◽  
The Us ◽  
Growth Prospects

Subject Prospects for emerging economies to end-2016. Significance Despite political risks causing bouts of volatility in countries such as Brazil and Turkey, emerging market (EM) growth prospects have improved moderately and asset prices have rebounded after the turbulence of early 2016. More stability in exchange rates has helped, with the US Federal Reserve (Fed) holding off raising rates. The rebound in commodity prices has been supportive, too, together with receding concerns about China's slowdown. Some countries have also eased fiscal policy to reduce social tensions risks.

Prospects for the global economy in 2018

2017 ◽  
Keyword(s):  
United States ◽  
Global Economy ◽  
Low Cost ◽  
Commodity Prices ◽  
Balance Of Power ◽  
The United States ◽  
Industrial Growth ◽  
Content Type ◽  
The Us ◽  
Open Markets

Subject PROSPECTS 2018: Global economy Significance Global GDP growth is likely to edge higher in 2018 as trade, investment and employment expand. However, monetary policy is gradually tightening, fiscal expansion is limited and there is little chance of a repeat of the surprise boost from trade seen in 2017 or a recovery in productivity. Inflation may remain obdurately low in the United States, Japan and the euro-area but not sufficiently to deter the US Federal Reserve (Fed) and the ECB from gently reeling in their bond-buying programmes. Modestly higher commodity prices should support economic recovery in resource producers. Impacts The timing of elections in the United States, Canada and Mexico may prolong the NAFTA trade talks into 2019 or beyond. China will battle any US attempts to constrain its innovation and access to technology, which it sees as key to its rebalancing. Technological progress and more open markets exacerbate the unpredictability of jobs and wages, but policy will increasingly address this. Automation means the job intensive low-cost industrial growth engine is now less effective; developing countries must consider new models. A better balance of power between multinationals, international organisations and governments will be key to global tax cooperation.

Unrest will complicate Macron’s reform agenda

2019 ◽  
Keyword(s):  
Euro Area ◽  
Budget Deficit ◽  
Economic Reforms ◽  
Content Type ◽  
Reform Agenda ◽  
High Ranking ◽  
Area Growth ◽  
Growth Prospects ◽  
High Ranking Official ◽  
Ability To Drive

Significance Fort will be the eighth high-ranking official to resign since Macron took office in 2017. This will raise further doubts over the credibility of Macron’s presidency and reform agenda. Impacts As the euro-area’s second-largest economy, France threatens euro-area growth prospects. Failure to control France’s budget deficit will result in conflict with Brussels. Such economic concerns will reduce Macron’s ability to drive EU political and economic reforms.

The ECB will set the speed of global credit tightening

2018 ◽  
Keyword(s):  
Financial Market ◽  
Euro Area ◽  
Market Volatility ◽  
Government Bonds ◽  
Content Type ◽  
Bank Of Japan ◽  
Global Growth

Significance The ECB's plan could tip the scales towards tighter credit conditions globally. However, there are concerns about global growth -- particularly in the euro-area -- and government bonds are proving extremely sensitive to hawkish policy, fuelling financial market volatility. Impacts The VIX index of anticipated US equities volatility is back near a record low, but volatility may rise and remain higher than recent years. Fed rate hikes and US growth outpacing the euro-area will strengthen the dollar although the euro briefly rose on the news of ECB tapering. The ECB trails the Fed by some years in policy tightening and forming a plan for unwinding QE; this divergence will also boost the dollar. The Bank of Japan is buying vast quantities of government bonds and has no plans to remove stimulus as inflation is far below the 2% target. Investors are appreciating and trusting Fed Chair Jay Powell's attempts to speak plainly and less formulaically than predecessor Yellen.

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