Economics and markets outlook February 2020 – Westpac
With January 2020 on the verge of completion, analysts at Westpac came out with the report marking the key events and global economic there for the upcoming month.
We have already seen disturbing slowdowns in business investment in the major economies partly in response to trade uncertainties and partly, more fundamentally, reflecting risk aversion and general caution. Trade uncertainty and political risks are unlikely to allay those concerns in 2020.
To date, employment growth has held up well in most developed economies. However, deteriorating business confidence and associated caution around employment decisions are likely to slow employment growth in 2020.
OECD growth slowed from 2.3% in 2018 to 1.7% in 2019. We are expecting that slowdown to extend into 2020 with OECD growth slowing further to 1.2%.
In 2020, Australia is not expected to lift its very disappointing growth rate of 2019, holding at 2.1% in 2020.
Further complicating the outlook is an expected continuation of the growth slowdown in China.
The dominant themes for 2020 will be developments in global trade disputes (which are not confined to US-China); the impact of the US Presidential election on business and consumer confidence; policy responses, both fiscal and monetary, and the implications for Chinese and global growth of the Coronavirus.