World Bank cuts 2015 global growth forecast (again)
June 10, 2015
World Bank Cuts 2015 Global Growth Forecast to 2.8%
The World Bank downgraded its outlook for global economic growth amid a broad-based slowdown in emerging markets and softer output in the U.S, The Wall Street Journal reported.
The development institution said that it now expects the world economy to grow by 2.8%, 0.2 percentage point slower than it estimated in January.
Sharp contractions in Brazil and Russia, alongside weaker growth in Turkey, Indonesia and scores of other developing economies are offsetting healthier growth in Europe and Japan, the bank said in its Global Economic Prospects report.
The estimate for U.S. growth was lowered to 2.7% from 3.2%.
Emerging markets are expected to face headwinds as borrowing costs are expected to rise as the Fed prepares to raise interest rates for the first time in nearly a decade. That prospect has also sparked a strong dollar rally, tightening the squeeze on developing-country governments and corporations that borrowed dollars but whose income is denominated in local currency.