EUR 4.00 For Business Accounts Only

Nigeria Strategy Report H2 2019 Excerpts- Global - Wobbly growth picture, more tilted to the downside

• Over the next few days, we will feature excerpts from our core strategy document – The Nigeria Strategy Report. The report communicates our understanding on key happenings in global and domestic financial markets over H1 2019 and provides our insight on what we believe will be the major themes underpinning investor sentiment for the rest of 2019. We begin the series with a look at the major themes that dominated the global economic and financial landscape in H1 2019 as well as our outlook for the rest of the year.
• Negating rhetoric at the beginning of the year of a broad-based deceleration in growth across Developed Markets (DMs) and stagnant growth in Emerging and Developing Economies (EMDEs), economic growth in DMs surprised over the first quarter of 2019 –  expanding 2.1% YoY compared to 1.8% in Q4 18 –, while growth in EMDEs decelerated by 10bps to 4.8% YoY. For advanced economies, the resilient growth was underpinned by persisting accommodative monetary and fiscal conditions which supported household spending and investment in U.S, U.K and the Eurozone. Elsewhere in EMDEs, the sluggish growth emanated from cutback in investment especially in oil importing countries and the knock-on effect of the lower commodity prices on oil exporting countries.
• Notwithstanding the strong outturn at the start of the year, global growth is expected to moderate to 3.3% over 2019 (2018: 3.6%) reflecting the impact of unresolved trade tensions between U.S and China, possibility of destabilizing policy developments in the U.K, the lag impact of persisting lower commodity prices and  renewed financial turmoil in EMDEs. Being a delicate year for the global economy, the policy environment (both monetary and fiscal) is expected to be largely accommodative across DMs and EMDEs. That said, growth in DMs is expected to print at 1.9% YoY (FY 18: 2.3% YoY) while growth in EMDEs is projected to slow to 4.8% YoY (FY 18: 4.9% YoY).