Monday, 9 November 2015

What are my favourite OECD Economic Outlook charts from the new half-yearly report

So what are my favourite OECD Economic Outlook charts from the big half-yearly report released today?  Surely there must be something of interest given @livesquawk summarised the numbers as:

OECD: 2015 Global Economic Growth Fcast Cut To 2.9% (Prev 3.0%), 2016 Cut To 3.3% (Prev 3.6%)

China slowdown not helpful for global trade...but the real negative impact comes when commodities are aggressively thrown into the mix too...

R-r-recession risk from poor trade progress based on historical empirical analysis. Shows again that China is so important for setting the tone for the global economy today: 

The end result is not only the GDP evolution noted above but that overall world GDP is perceived as offering a ‘modest projected upturn’. Note Brazil only clearly out of recession in 2017 whilst Japanese economic growth in the same year is...shabby: 

Structural reform progress iffy - and not just in Europe and Japan it seems...


China leading the way re credit growth and inevitably this increases vulnerabilities.

OECD not that excited re rebalancing in China...

Perhaps it is always the role of such institutions to be cautious but a 'modest projected upturn' combined with the risks of lower trade growth, a general lack of structural reforms and an uncertain rebalancing pace in China is not the strongest backdrop.  Combine this with c. 3% global growth and you have a patchy backdrop where there will be clear stock picking and theme/sector selection out and underperformers.  That feels like the current earnings season backdrop. 

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