A Global Outlook For 2020

What does 2020 hold for global economies?

By just looking at soaring stock markets you wouldn’t know the
world economy is on track to grow this year at the slowest pace in a decade…as the MSCI All-Country World index soared to all-time highs in November amid investor confidence about de-escalation of the U.S.-China trade war.

2020 begins with geopolitical fireworks in escalating tensions between Iran and the U.S. Oil prices shoot upwards of 4% or more. It is easy to forget that Brexit looms while the first phase of China-U.S. trade signals a deescalation in tensions.

12 months ago North American markets and an inverted yield curve was signalling a potential recession at the end of 2018. Fast forward to December 2019 as one of the best years in stock market performance. The S&P 500 hit 19 new highs in 2019 alone. The TSX/S&P composite it a 10 year high on December 24, 2019!

What’s Next?

GDP prospects for Canada in 2020 are forecasted to be similar to 2019. National Bank Financial Economics with an above-consensus call of 1.8% for 2020 real GDP growth. They assume some fiscal stimulus from the federal government. Barring a significant deterioration in the global economic outlook, National Bank Financial continues to expect the central bank to refrain from cutting interest rates over the near to medium term.

Please enjoy the detailed review from our partners at NBF Economics January 7, 2020 on their economic forecasts for 2020.