Global growth: Will the planetary alignment last? - Natixis

In view of Patrick Artus, Research Analyst at Natixis, the upturn in global growth since mid-2016 can be ascribed to the coincidence of a number of exceptional factors at a worldwide and suggests that we should be cautious as some of these positive factors could disappear.

Key Quotes

“These factors included: 

a)    Very low interest rates, enabling an acceleration in credit;

b)    An expansionary fiscal policy with a rise in the public debt ratio being maintained;

c)    A high level of profitability, giving rise to a high level of corporate investment;

d)    Capital returning to emerging countries, paving the way for an economic recovery in these countries;

e)    A persistently low oil price low despite the rapid growth in global demand for oil.”

“We should therefore be cautious as some of these positive factors could disappear: we cannot expect the private or public debt ratios to rise forever; it is likely that the oil price will rise as a result of the under-investment in conventional oil production.”