Weak outlook: Europe to slow down global economy.
"With growth in the United States expected to accelerate this year, Europe remains the weak link in the global economy," Kip Beckman, principal economist, says. "European governments are under increasing pressure to deal with soaring fiscal deficits and debt, even though private sector activity remains muted in most EU countries."
Following a less-than-stellar gain of 1.6 per cent last year, real gross domestic product (GDP) growth in the European Union (EU) is expected to be even weaker in 2011, at 1.4 per cent. The combination of austere fiscal policy, sluggish private sector demand and limits on credit from financial institutions could possibly push parts of the EU back into recession this year. although the winter 2011 outlook does not call for it.
In Latin America, weaker global trade and a leveling off in some commodity prices will result in slower growth of around four per cent this year. Brazil, the region's largest economy, will increase interest rates to contain inflation.
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|Title Annotation:||New and Noteworthy|
|Publication:||CMA Magazine (Mississauga)|
|Date:||Mar 1, 2011|
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