Outlook for emerging markets stable though risks remain: Moody’s

SINGAPORE (Aug 19): Moody’s Investor Service has increased its growth forecast for emerging markets up by 0.2 percentage points, to 4.4% for 2016 and 5.0% for 2017. This comes on the back of economic stabilisation in China, a modest recovery in commodity prices, and the return of capital flows.

In a Thursday report, Moody’s senior analyst Madhavi Bokil has forecast a growth rate of 6.6% for China's economy in 2016 and 6.3% in 2017 respectively, compared with earlier estimates of 6.3% and 6.1% respectively, due to significant fiscal and monetary policy support.

However, risks to China’s growth outlook in the medium term remain, particularly if policy support shows signs of ineffectiveness. Other countries are unlikely to be impacted as China’s imports have already been slowing down.

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