Global forecast: The economic storm is passing
Export Development Canada’s Global Economic Outlook is a must-read, packed with valuable information on the impact of COVID-19, as well as the growth in the next two years in the world’s key economies, commodity prices, interest rates and exchange rates.
With a steady vaccine rollout and as new coronavirus infection rates continue to decrease, confidence is building in economies around the world. Now that U.S. President Joe Biden’s administration’s US$1.9 trillion stimulus program is official, economists are unanimous that U.S. growth will be quite strong this year, at around 5%-6% in 2021.
EDC Economics have raised the forecast for U.S. growth in 2021 to 6.3%, a boost of over two percentage points from our autumn outlook. That’s a massive upward revision, and despite Buy American fears, is having a profound effect on global growth. We have increased our call for global growth to 6.4% for 2021, with a robust 5.4% forecast for 2022. The improved economic outlook for the U.S. will anchor the worldwide forecasts: China’s early rebound suggests strong support for its 10.8% bounce this year, while India is expected to see a whopping 12.3% pop. Following a decline of 5.3%, Canada is forecast to see a rebound of 5.5% this year, followed by above-average 4.1.% growth in 2022.
This is the best news since the pandemic hit a year ago. All being well, the fiscal boost should encourage private spending, finally lifting us from COVID-19’s quagmire.