The OECD and the World Bank have both recently released forecasts of future GDP trajectory. The OECD’s Composite Leading Indicators (CLIs) index fell in April, as it has done since January 2015. The index is built to lead the business cycle by about six months, and to project a slowdown or even a recession with a declining trend line. Despite the current negative trend worldwide, the index did highlight some spots of optimism, with stabilization in the U.S. and China, as well as for Russia and Brazil.
While the OECD is predicting stabilization, the World Bank is projecting a more subdued picture of growth in the years to come. The World Bank just lowered its forecasts of real GDP growth for 2016 and 2017 by 0.5% and 0.3% respectively. Those numbers don’t indicate global recession, but might feed a narrative that central banks and governments worldwide must do more to combat sluggish growth.
