President Donald Trump claims that countries with large trade surpluses are stealing jobs from the US. Therefore, he wants to reverse existing trade deals, which have made it possible to move American jobs to low-cost countries. However, historically, trying to move jobs between countries has had a bad track record. In the 1930s, it led to aggressive trade wars. In our view, common sense should prevail to stop politicians, including Donald Trump, from implementing such policies before a full-scale trade war ensues.
In recent quarters, the Indian economy did not perform as well as before. Fixed investment has been falling, while personal consumption spending has been holding up. Our view is that the problems are temporary and that GDP will continue to grow annually by 7.5 percent in the coming years. Additionally, demonetisation continues to throw its shadow over the economy, while Modi's new budget might be too optimistic.
- Shift from monetary policy easing to tightening
- No dramatic monetary policy tightening ahead
- PMI from Markit signals growth will slow even without higher interest rates
- Stable official PMI
- Growth will soon gradually slow again
US: Moment of truth for Trump
Eurozone: Strong finish to 2016 bodes well for 2017
Nordics: Drifting apart
- Remarkably stable 2016
- Monthly figures show mixed signals for December
- Several headwinds moving into 2017