As an informed exporter, it is important to know the major economic indicators of the countries where you are exporting. This is important to foresee if there are any possible chances of payment defaults. If there is, changes can be made in the payment terms. Hence, in order to aid this decision making process, we present the findings provided by the Euler Hermes in weekly frequency. Major indicators like GDP, sectoral development changes, major economic policies decision, sentiments after any new political appointment, bank rate changes etc. help in painting the economic condition of the country for the whole week.

Following a robust expansion in 2017, global economic momentum has been more or less maintained in 2018 but is set to increasingly lose steam through 2019. Risks to the outlook continue to mount, especially stemming from the unfolding US-China trade war.

• Global GDP growth is forecast to slightly accelerate to 3.1% in 2018 from 3.0% in 2017. In 2019, the world economy is forecast to expand 2.8%.
• The US economy, with strong fundamentals further fuelled by fiscal stimulus, is expected to expand 2.9% this year before easing to 2.5% growth next year. The eurozone economy continues to cool off as growth decelerates from 2.0% in 2018 to 1.7% in 2019. The UK’s economy is slowing to 1.3% this year but is expected to remain resilient with 1.5% in 2019.
• GDP growth across emerging market economies (EMEs) is holding up in 2018 and 2019 at 4.5% and 4.4% respectively. Emerging Asia will remain the growth leader but is losing pace to 5.6% growth in 2019 from 6.0% this year. Eastern Europe and MENA (Middle East & North Africa) are also losing momentum while Sub-Saharan Africa and Latin America are forecast to see moderate accelerations in 2019.
• As global growth keeps pace this year, another 4% decline in insolvencies in advanced economies is forecast. We forecast only a 1% decline in 2019 as growth momentum eases.

The positive global growth outlook is increasingly clouded by downside risks, especially the unfolding trade war between the US and China. Rising uncertainty could strain global investment, a major determinant of global trade.

The most prominent risk is that of a global proliferation of the US-China trade war. The second highest risk remains misguided Fed policy which would put a brake on US economic activity and cause financial turbulence largely at the expense of EMEs. The remaining risks are (3) a financial market correction, (4) the rapid continuation of the upward trend in the oil price, (5) a hard landing of the Chinese economy, and (6) geopolitical risk.

Uncertainty in the Eurozone is also increasingly clouding its steady outlook, stemming from the new populist government in Italy and Brexit negotiations with the UK. Also, advanced Asia is losing momentum as growth in China and global trade eases.

In general, prospects for EMEs remain bright over the forecast period, but idiosyncratic weaknesses and ongoing vulnerability to external developments continue to cloud individual countries’ outlooks. Capital outflows and currency depreciations experienced this year are highlighted as evidence of this. As global trade conditions deteriorate, these markets are more dependent on strong domestic economies. In line with the heterogeneity of countries, the consequences of the unfolding trade war and domestic policy differ greatly.

Business risks continue to grow though as trade and monetary policy move in a less accommodative direction for firms. As such global insolvencies are forecast to stabilise in 2019.

Source:  www.group.atradius.com