Weak global growth in the next two years due to China and the emerging economies

Global growth will be lacklustre over the next two years as the slowdown in China and other emerging markets continues to weigh on the world economy, Moody's Investors Service said in a report published today.

Moody's forecasts that G20 GDP growth will average 2.8% in 2015-17, only 0.3 percentage point higher than in 2012-14 and below the 3.8% average recorded in the five years before the global financial crisis. The rating agency's latest forecasts are broadly unchanged from its last quarterly Global Macro Outlook in August.

“Muted global economic growth will not support a significant reduction in government debt or allow central banks to raise interest rates markedly,” said the report's author Marie Diron, Senior Vice President, Credit Policy. “Authorities lack the large fiscal and conventional monetary policy buffers to protect their economies from potential shocks.”

The report, “Global Macro Outlook 2015-17: Lacklustre Global Economic Recovery Through 2017 Diminishes Resilience to Shocks”, is now available on www.moodys.com. Moody's subscribers can access this report via the link at the end of this press release. The research is an update to the markets and does not constitute a rating action. (MTI, Kertész Róbert)