Out today; first, the IMF’s reference scenario:
This is the reference scenario, invoking a short war. Here are revisions preconflict, and Adverse and Severe scenario outlooks (%, y/y).
Out today; first, the IMF’s reference scenario:
This is the reference scenario, invoking a short war. Here are revisions preconflict, and Adverse and Severe scenario outlooks (%, y/y).
The U.S. does OK in the reference scenario, as you’d expect.
What I find odd is that China, with a diversified energy base, is among the worst performers, slightly worse than Japan, which has a less diversified energy base. Petrochemicals, maybe. China’s petrochemical industry is over-built. Japan’s petrochem sector has been restructuring. Even so, that seems a small issue relative to energy diversity.
I am a little surprised to see anticipated economic growth in the United States remaining at 2% or more. I expect it to falter, if not go negative, based upon inflationary pressures, interest rates, and related issues. The job market has been weak lately, meaning things are slowing. Am I reading this wrong?
I see your point. Really do.
If I were to try to find an argument for this growth outlook, I’d say the U.S. is going to redistribute growth from oil users to oil producers and industries that supply oil producers. The rest of the world – except other non-Gulf oil and gaa producers, will suffer either from reduced domestic oil and gaa output or reduced oil and gas imports. Not sure I believe this story, but it isn’t crazy.
What’s absolutely clear is that the confidence interval around every point estimate is wide and skewed downward.
Biden left us a much stronger economy that most people realize. It has held up in spite of the trump follies.