World Bank cuts global economic growth outlook
The bank forecast the Russian and Brazilian economies would continue to contract in 2016 rather than return to growth as it had estimated in its previous outlook in June.
The World Bank on Wednesday cut its global economic growth forecast for 2016, saying the weak performance of major emerging market economies will tamp activity overall, as will anaemic showings from developed countries such as the United States.
Global growth should accelerate to 2.9 percent this year from 2.4 percent in 2015, the bank said, but that still represents a downgrade from its June forecast for 3.3 percent growth.
The bank raised particular concern about the flagging performance of top emerging economies.
"Given the size and global economic integration of the largest emerging markets - Brazil, the Russian Federation, India, China, and South Africa, or the so-called BRICS - the simultaneous slowdown underway in all but one of them could have significant spillovers to the rest of the world," the report said.
The bank forecast the Russian and Brazilian economies would continue to contract in 2016 rather than return to growth as it had estimated in its previous outlook in June.
Real gross domestic product in Russia could shrink at a 0.7 percent annual pace this year, it said. In June it had forecast 0.7 percent GDP growth for 2016. The bank estimates the Russian economy shrank by 3.8 percent in 2015.
In Brazil, GDP is forecast to decline by 2.5 percent in 2016 compared with an earlier estimate for growth of 1.1 percent, the World Bank said. The Brazilian economy likely contracted at a 3.7 percent rate in 2015.
China GDP growth was estimated to slow to 6.7 percent in 2016 from an estimated 6.9 percent in 2015. In June the bank had estimated 2016 growth of 7.0 percent.
The South African economy should grow at a modestly faster rate in 2016 than last year - 1.4 percent compared with 1.3 percent - but substantially slower than the 2.1 percent growth forecast in June.
Of that group, India was the only one expected to see notable improvement in economic performance from 2015 - advancing at a 7.8 percent rate in 2016 versus 7.3 percent in 2015. But even there, the bank nipped its 2016 estimate by 0.1 percentage point from its earlier forecast.
The bank also trimmed its outlook for the United States and other developed economies.
The U.S. economy should grow by 2.7 percent, down from an earlier estimate of 2.8 percent but up from 2015's 2.5 percent.
Estimates for growth in the euro zone were trimmed by the same amount, to 1.7 percent from 1.8 percent previously, although that would mark a modest acceleration from 2015's estimated 1.5 percent rate.
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