Saturday, March 10, 2012
Hypo Venture Capital: Hypo Venture Capital Headlines: Outlook for global...
Hypo Venture Capital: Hypo Venture Capital Headlines: Outlook for global...: http://www.free-press-release.com/news-hypo-venture-capital-headlines-outlook-for-global-economy-in-2012-1328540186.html We expect 2012 t...
Hypo Venture Capital Headlines: Outlook for global economy in 2012
http://www.free-press-release.com/news-hypo-venture-capital-headlines-outlook-for-global-economy-in-2012-1328540186.html
We expect 2012 to be a year of slowing global growth, with wide divergences between regions and countries. Overall global growth will slow from about 3% in 2011 to 2.5% in 2012. For 2013, a modest recovery in global growth is likely.
The Euro-zone sovereign debt crisis will escalate, provoking a sufficiently strong policy response from the European Central Bank (ECB) and creditor governments to prevent Euro-zone disintegration and a string of disorderly sovereign debt defaults. Even so, sovereign spreads will remain unusually wide even at end-2012. The euro area already probably is falling back into recession, with negative quarter-over-quarter growth in fourth quarter of 2011 likely to carry over into 2012. Real GDP in the euro area will drop by at least 1% in 2012.
The United Kingdom is likely to be near recession, and we also look for a marked slowdown in Eastern Europe in 2012. By contrast, modest but sustained growth will occur in the United States in 2012 and beyond, and still relatively strong but slowing growth will take place in 2012 in emerging Asia, Latin America, Africa and the Middle East. In all, there will be sluggish growth in the advanced economies (around 1% yearover-year in 2012), with emerging market growth of about 5% for 2012.
The United Kingdom is likely to be near recession, and we also look for a marked slowdown in Eastern Europe in 2012. By contrast, modest but sustained growth will occur in the United States in 2012 and beyond, and still relatively strong but slowing growth will take place in 2012 in emerging Asia, Latin America, Africa and the Middle East. In all, there will be sluggish growth in the advanced economies (around 1% yearover-year in 2012), with emerging market growth of about 5% for 2012.
As a result, the extent to which global growth is China-dependent will increase. The lagged effect of past domestic tightening and slowing export growth are likely to cool China’s growth below 9% in 2012. Nevertheless, China will continue to account for a huge share of global growth.
The specific predictions for 2012 could be summarised as follows.
The specific predictions for 2012 could be summarised as follows.
The US will avoid a recession: The US domestic risks have diminished somewhat and growth momentum has picked up modestly. After a fairly miserable first half of the year, the economy grew by 2% in the third quarter and is likely to ac¬celerate to more than 3% growth in the final quarter of 2011. There are a number of signs that recent momentum could carry into next year – job openings are on the rise, the unemploy¬ment rate is trending down and corporate profits relative to GDP are at their highest level in over six decades.
Recession in the Euro-zone: The Euro-zone sovereign debt and banking crisis will intensify further in 2012, with sovereign yield spreads vs German Bunds remaining high in many Euro-zone countries, and many countries in the euro-zone in recession. We do not, however, expect the euro area to break up in 2012 or the following years, nor do we expect the disorderly default of an euro-zone country. The risk that either or both of these disaster scenarios materialise is, however, non-negligible at around 25%.
Recession in the Euro-zone: The Euro-zone sovereign debt and banking crisis will intensify further in 2012, with sovereign yield spreads vs German Bunds remaining high in many Euro-zone countries, and many countries in the euro-zone in recession. We do not, however, expect the euro area to break up in 2012 or the following years, nor do we expect the disorderly default of an euro-zone country. The risk that either or both of these disaster scenarios materialise is, however, non-negligible at around 25%.
Asian growth will continue: While Asia will not remain immune to a recession in the Euro-zone, growth in the region will continue to be the strongest in the world for a number of reasons. First, Japan’s post-earthquake rebound will help to underpin the region’s exports, offsetting some of the weakness in sales to Europe. Second, Chinese economic growth will be around 8% and further bolster Asian growth prospects. Third, easing inflation will give all Asian governments much leeway to stimulate, if necessary.
Growth in emerging markets will continue: The Euro-zone crisis will have an adverse impact on emerging European countries as Western Europe is its most important export destination and also because the region is dominated by subsidiaries of Western European banks — all of which are tightening credit. Latin America and Africa are relatively more vulnerable to the United States and China so, barring a plunge in commodity prices, the growth in these regions should be reasonable.
Growth in emerging markets will continue: The Euro-zone crisis will have an adverse impact on emerging European countries as Western Europe is its most important export destination and also because the region is dominated by subsidiaries of Western European banks — all of which are tightening credit. Latin America and Africa are relatively more vulnerable to the United States and China so, barring a plunge in commodity prices, the growth in these regions should be reasonable.
Hypo Venture Capital: Hypo Ventures Capital Headlines: Greece’s Debt Swa...
Hypo Venture Capital: Hypo Ventures Capital Headlines: Greece’s Debt Swa...: http://hypoventurecapital-news.com/ The Institute of International Finance, which represented private creditors in the negotiations over ...
Hypo Ventures Capital Headlines: Greece’s Debt Swap Endorsed by IIF as Investors Left to Decide
http://hypoventurecapital-news.com/
The Institute of International Finance, which represented private creditors in the negotiations over Greece’s debt swap, endorsed the final terms of the deal and left its members to choose whether to take part. “The decision to participate in the debt exchange lies exclusively with individual investors,” the IIF said in a statement issued by e-mail today after a board meeting yesterday in Zurich,Switzerland. The Washington-based group represents more than 450 financial services companies around the world. Private creditors reached an agreement with Greek and European officials last week on the biggest sovereign debt restructuring in history. The plan seeks to reduce Greece’s borrowings by about 106 billion euros ($140 billion) and lower debt to 120.5 percent of gross domestic product by 2020. Under the deal, investors will forgive 53.5 percent of their principal and exchange their remaining holdings for new Greek government bonds and notes from the European Financial Stability Facility. Euro-area finance ministers last week authorized the EFSF to issue bonds for the swap. The success of the deal depends on how many investors participate in the transaction. The swap “will contribute meaningfully” to Greece’s efforts to restructure its economy and secure a new rescue package from the European Union and International Monetary Fund, the IIF said. “These are important steps towards resolving the Greek debt crisis, addressing the overall fiscal and sovereign debt problems in the euro area, and restoring financial stability, which is essential to foster economic growth and job creation,” the IIF said in its statement.
New Panels
The trade group also announced the leaders of two panels that will focus on particular financial services. Walter Kielholz, chairman of Swiss Re, was named head of a new asset management and investment council that will focus on long-term investment issues. The panel’s members will be chief executive officers and chairmen from asset managers, life insurers, pension funds and sovereign wealth funds. The group will “bring forward to the public policy debate the unintended consequences that could result from uncoordinated or poorly thought-through regulatory changes that might prompt traditional long-term investors to take a shorter-term view,” said Charles Dallara, the IIF’s managing director. The IIF also named Martin Senn, CEO of Zurich Financial Services Group, as chairman of the group’s insurance regulatory committee. Senn said the panel, composed of senior insurance executives, will champion the insurance business and “strengthen the IIF’s work in its dialogue with the official regulatory authorities,” according to the statement.
The Institute of International Finance, which represented private creditors in the negotiations over Greece’s debt swap, endorsed the final terms of the deal and left its members to choose whether to take part. “The decision to participate in the debt exchange lies exclusively with individual investors,” the IIF said in a statement issued by e-mail today after a board meeting yesterday in Zurich,Switzerland. The Washington-based group represents more than 450 financial services companies around the world. Private creditors reached an agreement with Greek and European officials last week on the biggest sovereign debt restructuring in history. The plan seeks to reduce Greece’s borrowings by about 106 billion euros ($140 billion) and lower debt to 120.5 percent of gross domestic product by 2020. Under the deal, investors will forgive 53.5 percent of their principal and exchange their remaining holdings for new Greek government bonds and notes from the European Financial Stability Facility. Euro-area finance ministers last week authorized the EFSF to issue bonds for the swap. The success of the deal depends on how many investors participate in the transaction. The swap “will contribute meaningfully” to Greece’s efforts to restructure its economy and secure a new rescue package from the European Union and International Monetary Fund, the IIF said. “These are important steps towards resolving the Greek debt crisis, addressing the overall fiscal and sovereign debt problems in the euro area, and restoring financial stability, which is essential to foster economic growth and job creation,” the IIF said in its statement.
New Panels
The trade group also announced the leaders of two panels that will focus on particular financial services. Walter Kielholz, chairman of Swiss Re, was named head of a new asset management and investment council that will focus on long-term investment issues. The panel’s members will be chief executive officers and chairmen from asset managers, life insurers, pension funds and sovereign wealth funds. The group will “bring forward to the public policy debate the unintended consequences that could result from uncoordinated or poorly thought-through regulatory changes that might prompt traditional long-term investors to take a shorter-term view,” said Charles Dallara, the IIF’s managing director. The IIF also named Martin Senn, CEO of Zurich Financial Services Group, as chairman of the group’s insurance regulatory committee. Senn said the panel, composed of senior insurance executives, will champion the insurance business and “strengthen the IIF’s work in its dialogue with the official regulatory authorities,” according to the statement.
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