MOMR September 2017
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World Economy


OPEC Monthly Oil Market Report – September 2017

World Economy

Global economic growth momentum has gained traction lately and has become more balanced, with all

major economies now showing positive growth this year, a trend that is forecast to continue into 2018. With

mainly better-than-expected growth seen recently in the OECD group of economies, global growth for 2017

was revised up to 3.5%, while the economic growth forecast for 2018 remains unchanged.

The OECD’s GDP growth in 2017 was revised up to 2.2%, while the 2018 forecast remains unchanged at

2.0%. This uptick was mainly supported by an ongoing strong growth dynamic in the Euro-zone and the US

economy also showed solid growth in 1H17. Additionally, the major emerging economies held up well, as

China’s growth in 1H17 was better-than-expected and is now forecast to reach 6.7% in 2017 and 6.3% in

2018. India’s 1H17 growth dynamic was negatively impacted by major structural reforms (GST and

demonetisation), but it is forecast to remain considerably supported at 6.9% in 2017 and to rebound to 7.5%

in 2018, boosted by ongoing structural reforms. Russia and Brazil will also continue their recovery and are

forecast to grow by 1.5% and 0.5% in 2017 and by 1.4% and 1.5% in 2018, respectively, though this also

depends on developments in commodity prices and politics, as well as presidential elections in both

countries in the coming year.

With the expected continuation of ongoing growth momentum in 2H17, there is still some room to the upside

for currently anticipated global growth levels in both 2017 and 2018. At the same time, challenges remain,

mainly related to global political developments and upcoming monetary policy decisions, particularly in the

US and the Euro-zone. Seemingly high valuations in equity and bond markets, in combination with low

volatility, pose a risk at a time when central banks have become more willing to reduce monetary stimulus

measures. Debt levels also remain high in some key economies, an issue that will probably require further

attention if interest rates continue to rise gradually, particularly in the US. Finally, sustained stability in

commodity prices, particularly oil prices, is viewed as necessary for ongoing improvement in global economic


Table 3 - 1: Economic growth rate and revision, 2017-2018*, %


OECD Americas


US GDP growth

in 2Q17 was revised up to a considerable level of 3.0% q-o-q at a seasonally adjusted

annualised rate (SAAR), after a previous estimate of 2.6% q-o-q SAAR. This makes the recovery from 1Q17

GDP growth of only 1.2% q-o-q SAAR even more visible. Consumption was confirmed as the main driver; it

expanded by 3.3% q-o-q SAAR. While lower than in 1Q17, exports also performed well, growing by 3.7%

q-o-q SAAR, after rising by 7.3% q-o-q SAAR in 1Q17, despite a still relatively strong US dollar. Moreover,

investments continued to grow, with a considerable share coming from the energy sector. This positive

momentum is now expected to continue in 2H17, albeit at a lower level.

World OECD US Japan


zone UK China India Brazil Russia


3.5 2.2 2.1 1.4 2.1 1.5 6.7 6.9 0.5 1.5

Change from previous month

0.1 0.2 0.0 0.0 0.1 0.0 0.0 -0.1 0.0 0.3


3.4 2.0 2.2 1.2 1.8 1.4 6.3 7.5 1.5 1.4

Change from previous month

0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.0 0.0 0.0

Note: * 2017 and 2018 = Forecast.

Source: OPEC Secretariat.