Top-10 Economic Predictions for 2011
A two-speed recovery is likely to remain a salient feature of the global economy throughout 2011. The deceleration in growth that manifested itself in the latter half of 2010 will extend into the first half of 2011—for nearly every region and country in the world. However, the global recovery should pick up steam in the second half of the year, as some of the worst-hit sectors (housing and autos) rebound and as consumer and business confidence improves. Arithmetically, this means that growth in calendar-year 2011 (3.3%) will be a little weaker than in 2010 (4.0%), but then followed by a bounce-back in 2012 (3.7%). While there is no shortage of downside risks, global growth has been revised up in recent months, which means that the distribution of risks may be more symmetric than a year ago.
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Top-10 Economic Predictions for 2010: How Accurate Were We?
Here is what IHS Global Insight said in December 2009 as we introduced our Top-10 Predictions for 2010:
The U.S. and world economies have emerged from recession and the recovery process has begun. Unfortunately, for most developed economies, this recovery will not feel like one in its early stages. Strong tailwinds (policy stimulus, improved financial conditions, and pent-up demand) are being partially neutralized by equally strong headwinds (rising unemployment rates, lingering hangovers from housing bubbles and the financial crisis, and the likely winding-down of fiscal stimulus). Consequently, global GDP will grow only 2.8% in 2010, much better than the 2.0% drop in 2009, but well below its 3.5–4.0% trend rate of growth. Most emerging markets, particularly Asia, will outpace the developed economies next year. The U.S. economic recovery will begin the year slowly, but Europe and Japan will rebound even more slowly.
While world GDP growth was stronger than predicted (4.0%), 9 out of 10 of IHS Global Insight's predictions for 2010 were on the mark.
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