'Global economy, financial markets likely to stabilise in 2013'
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'Global economy, financial markets likely to stabilise in 2013'

Last Updated: Sunday, December 23, 2012, 11:33
 
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'Global economy, financial markets likely to stabilise in 2013'
New Delhi: Global economy and financial markets are likely to witness stabilisation and get strengthened during 2013 although "challenges" still remain, Credit Suisse said in a report.

The growth contribution from emerging market economies is likely to support the overall global economy mainly driven by China, the report said.

"Following its ... Growth slowdown, China has moved to a sustainable medium-term growth trajectory and in economic terms too is likely to be a bigger influence again - not only within the region but also beyond it," Credit Suisse said.

Moreover, China will also be watched more closely against the backdrop of a changing political guard, it said.

Meanwhile, in overall terms, the euro zone is likely to make a mildly positive contribution to global growth compared to 2012.

"Germany will once again be the engine of growth thanks to private consumption, while the peripheral countries will in most cases show negative growth rates," the report said.

Sovereign debt remains the focal point, both politically and economically, while the debate surrounding the so-called US fiscal cliff is likely to set the tone for the financial markets - particularly at the start of the year.

However, the geopolitical risks are likely to be similar to those of 2012 owing to the tense situation in both the Middle East and the Far East, it said.

The report further noted that despite a moderately optimistic outlook for the year ahead, a number of major challenges still remain.

"First, we should not expect a one-way street in terms of financial market technicals - as was the case in 2012. Thus a well-diversified, balanced portfolio is not just a theoretical truism but essential to our investment strategy, the report added.

PTI


First Published: Sunday, December 23, 2012, 11:33


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