Global Monthly October 2017 Overview Table of Contents • The global recovery is ongoing, but momentum is likely to Monthly Highlights ............................................ 2 have moderated somewhat following a strong performance Special Focus ..................................................... 6 in 17Q2. Recent Prospects Group Publications ..................... 7 • Global goods trade growth generally remains solid and Recent World Bank Working Papers...................... 7 services trade is gradually strengthening. Recent World Bank Reports ................................. 7 • Global financing conditions have slightly tightened, and Table A: Major Data Releases .............................. 7 capital flows to emerging markets and developing economies Table B: Activity and Inflation ............................ 8 (EMDEs) have softened. Table C: Trade and Finance................................ 8 Table D: Financial Markets ............................... 9 • Brent oil prices continued to rise in October, underpinned Table E: Commodity Prices ................................. 9 by rising demand and high compliance with the production- cut agreement. Investment growth in commodity-exporting EMDEs Chart of the Month • Investment growth in commodity-exporting EMDEs was positive (y/y) in 17Q2, after contracting for 12 consecutive quarters. • The bottoming out of investment growth reflected a stabilization in commodity prices, diminished drag from earlier policy tightening, and favorable external financing conditions. • The return to positive investment growth has not occurred in all regions, however, as it remains negative in Latin Source: World Bank. America and Sub-Saharan Africa. Note: Investment is the gross fixed capital formation component of GDP. Commodity-exporting EMDE aggregate includes Argentina, Brazil, Bolivia, Chile, Colombia, Costa Rica, Indonesia, Malaysia, Nigeria, Paraguay, Russia, South Africa, and Ukraine. Last observation is 2017Q2. Special Focus: Spillovers from Recovery in Major Economies • Growth has been recovering in major advanced economies and the largest EMDEs. This entails positive spillovers for the rest of the world. • Advanced economies remain the largest source of international spillovers, even as large EMDEs have become key players in the global economy. • A 1-percentage-point positive growth shock in G7 economies is estimated to raise global growth by 0.9 percentage point on impact, while an equivalent shock in the seven largest EMDEs raises global growth by 0.2 percentage point. e Global Monthly is a publication of the Global Macroeconomics Team of the Prospects Group in the Development Economics Vice Presidency. is edition was prepared by Marc Stocker and Dana Vorisek, based on contributions from John Ba es, Mai Anh Bui, Sinem Celik, Gerard Kambou, Eung Ju Kim, Csilla Lakatos, Hideaki Matsuoka, Yoki Okawa, Temel Taskin, Ekaterine Vashakmadze, Collette Wheeler, and Jinxin Wu. is Global Monthly re ects information available as of October 24. For more information, visit: www.worldbank.org/en/research/brief/economic-monitoring October 2017 Monthly Highlights FIGURE 1A Composite output PMIs Global growth: ongoing recovery. Global growth is likely to have moderated slightly in 17Q3, after reaching an almost seven-year high of 3.6 percent (q/q saar) in 17Q2. Among major economies, growth in the United States was only temporarily held back by the landfalls of two major hurricanes, while it slowed somewhat in China. Activity continues to expand at a robust pace in the Euro Area and is showing signs of continued recovery in commodity-exporting EMDEs. Global composite PMI surveys were stable in 17Q3 and point to the persistence of favorable conditions for activity (Figure 1.A). Global (median) in ation edged up in September, in part due to a rebound in energy prices, while core in ation remained low across major advanced FIGURE 1B Global export growth (in value) economies and in China. Global trade: still robust. Goods trade growth was solid during 17Q3, supported by a fourth consecutive quarter of rapid growth in global manufacturing activity. Positive momentum was con rmed by gains in export orders, international air freight, and container port tra c. Global exports of commercial services (measured in value) is also accelerating, though at a slower pace (Figure 1.B). Services trade ows are less sensitive to short-term inventory and production cycles, but their correlation with goods trade growth is elevated, consistent with the increased “servici cation” of manufacturing activity. e pickup in global trade has been accompanied by a broad-based export recovery in advanced economies and EMDEs. FIGURE 1C U.S. hourly wage growth United States: underlying strength. Growth is likely to have moderated somewhat in 17Q3, following a signi cant pickup in 17Q2 (3.1 percent q/q saar). is partly re ects the temporary impact of two major hurricanes, which contributed to a contraction in industrial production and private sector jobs in September (the rst decline in employment levels since 2010). However, other data indicate underlying strength. e unemployment rate fell to 4.2 percent in September, the lowest reading since early 2001, and hourly earnings growth rose to 2.9 percent (y/y), the highest reading since mid-2009. Retail sales bounced back and consumer sentiment increased to a 13-year high. Despite rising wage growth, core CPI in ation remained at Sources: Haver Analytics, U.S. Bureau of Labor Statistics, World Bank, WTO. A. Values above 50 indicate expansion. Last observation is September 2017. a two-year low of 1.7 percent in September. B. Nominal exports. Services export data is based on a sample of 33 countries and represents exports of commercial services. Last observation is June 2017. C. Average hourly earnings of all private sector employees. Last observation is Euro Area: robust growth. After growing 2.6 percent (q/q saar) in September 2017. 2017Q2, activity remained robust in 17Q3. e composite PMI, 2 October 2017 economic sentiment, and business climate surveys all pointed to an ongoing recovery—including in manufacturing, despite the FIGURE 2A Euro Area unemployment rates dampening e ect of past euro appreciation. Labor market conditions also improved. e unemployment rate was stable in June through August, at 9.1 percent (sa), the lowest level since early 2009, while the dispersion across countries continued to narrow (Figure 2A). In ation increased to 1.5 percent in August and remained at that level in September—still well below the European Central Bank’s target of 2 percent. Japan: record low unemployment. In 2017Q3, the Bank of Japan’s Tankan business sentiment index increased to a level last seen in 2006, supported by solid exports (Figure 2B). e unemployment rate has been stable since June, at 2.8 percent— FIGURE 2B Japan business sentiment the lowest level since 1994. In ation rose to 0.7 percent (y/y) in August, from 0.4 percent in July, mainly driven by rising energy prices. However, core in ation is still considerably lower, at 0.2 percent. e Bank of Japan left policy rates unchanged at negative 0.1 percent at its September meeting. Snap elections held on October 22 resulted in a sweeping victory for Prime Minister Shinzo Abe’s Liberal Democratic Party. China: rising debt. Growth softened in 17Q3, to 6.8 percent (y/ y), following a solid 6.9 percent (y/y) pace of expansion in the rst half of 2017. Recent data has been mixed. In September, industrial production growth accelerated to 6.6 percent (y/y), while mining production contracted by 3.8 percent. e Caixin composite PMI dropped, driven by a sharp decline in the services FIGURE 2C China’s general government debt and structural fiscal balance sector index. Fiscal policy has remained expansionary in 2017, supporting growth but contributing to rising public debt (Figure 2C). Private credit as a share of nominal GDP has also continued to increase, and the central bank announced in October a cut in the required reserve ratio starting in 2018 for banks that meet certain thresholds for small-business and agricultural lending. Tighter enforcement of capital- ow management measures continued to limit capital out ows and helped restore foreign reserves in 17Q3. At the 19th National Congress of the Communist Party held October 18-24, President Xi indicated that policies will aim to put China on sounder economic footing by containing nancial risks, encouraging innovation, and Sources: Bank of Japan, Eurostat, International Monetary Fund, World Bank. increasing consumer spending. A. Sample excludes Greece. Range reflects the minimum and maximum across Euro Area countries. Seasonally adjusted data. Last observation is August 2017. B. Survey data across large enterprises for all industries. Diffusion index is the EMDE commodity exporters: continued recovery. Recent percent of favorable minus the percent of unfavorable responses, scaled to the number of responses. Last observation is 2017Q3. indicators suggest a further pickup in activity in 17Q3. In Brazil, C. Structural fiscal balance is the cyclically-adjusted primary balance in percent of potential GDP. Data for 2016 and 2017 are estimated. 3 October 2017 industrial production and retail sales growth (y/y) accelerated in FIGURE 3A Foreign exchange reserves and ex- July and August, and the composite PMI improved in each of the change rates in EMDE commodity exporters past three months, reaching 51.1 (sa) in September. Growth in Russia is likely to have remained sustained in 17Q3, following a signi cant pickup in 17Q2 (2.5 percent y/y). e composite PMI remains expansionary, growth in industrial production and retail sales has been robust, and capacity utilization is stable. Headline in ation eased more than expected in September, to 3 percent. In Indonesia, recent data indicate that activity accelerated in 17Q3. Industrial production rebounded in July, the trade balance moved back to surplus in August, and the manufacturing PMI returned to expansionary territory in September. In Nigeria, manufacturing and non-manufacturing PMI readings in 17Q3 were well above 17Q2 levels. e improvement suggests that the FIGURE 3B Industrial production growth in EMDE recovery that began in the oil sector in 17Q2 is broadening. After commodity exporters and importers softening at the start of 17Q3, activity indicators for South Africa improved again in August. Mining output expanded 6.9 percent (y/y), on rising metals prices, and manufacturing production rebounded after contracting in July. e improvement in activity in large commodity-exporting EMDEs has been accompanied by rising foreign exchange reserves, despite some softening in currencies (Figure 3A). EMDE commodity importers: mostly robust activity. Activity in most commodity-importing economies is solid, as indicated by steady industrial production growth (Figure 3B). Both domestic demand and export growth appear to have been sustained in 17Q3. In India, the manufacturing PMI was in expansionary FIGURE 3C U.S. Treasury yields and long-term territory in August and September, at 51.2 (sa), after temporarily forward inflation expectations dropping in July. In ation was stable in September, at 3.3 percent (y/y), after reaching a historical low earlier in 2017. Recent data for Turkey suggest continued expansion in the business sector, with strong industrial production growth in July and August, and the manufacturing PMI at 53.5 in September. Core in ation reached 11 percent in September, the highest since 2008. In Poland, solid August industrial production and September manufacturing PMI readings suggest that strong growth continued in Q3, after reaching 4.6 percent (y/y) in 17Q2. In contrast, activity in Mexico softened in 17Q3. e central bank’s indicator of economic activity was markedly lower (y/y) in July Sources: BIS, Bloomberg, World Bank. and August than the average during 17Q2, and industrial A. Nominal effective exchange rates reflect broad indexes. An increase denotes currency appreciation. Sample includes 9 commodity-exporting EMDEs. Last production contracted (y/y) for a third consecutive month in observation is August 2017. B. Seasonally adjusted data. Last observation is August 2017. August. Manufacturing and services PMIs remain expansionary, C. Last observation is October 23, 2017. 4 October 2017 however, and consumer con dence rose throughout 17Q3. Headline and core in ation moderated slightly in September, to FIGURE 4A Financial market volatility (VIX) 6.4 percent (y/y) and 4.8 percent (y/y), respectively, after rising sharply since mid-2016. Global nancing conditions: slight tightening. Global nancing conditions remain benign, but have slightly tightened in October, as bond yields increased amid expectations of further monetary policy normalization in the United States. U.S. 10-year Treasury yields have risen more than 30 basis points from this year’s lows in early September, as the yield curve steepened, while long-term in ation expectations have been broadly stable (Figure 3C). Financial market volatility remains exceptionally low, with the VIX index falling to a new historical low despite ongoing policy and geopolitical uncertainty (Figure 4A). FIGURE 4B Cross-border bank lending and international bond issuance for EMDEs EMDE capital ows: somewhat weaker. Despite continued search for yields, EMDE assets underperformed in September and early October, and the pace of foreign capital in ows to bond and equity mutual funds slowed. EMDE stocks posted their rst monthly loss of the year in September, followed by some rebound in October, and currencies have generally depreciated, as U.S. long-term yields and the U.S. dollar rose. However, EMDE bond spreads remained at their lowest level since May 2014 and bond issuance continued at a robust pace. Borrowers from Middle East and North Africa have accounted for nearly one-third of bond sales since early September, with Saudi Arabia raising $12.5 billion. Cross-border bank lending ows continue to be subdued, FIGURE 4C Oil price and metals index prolonging a post-crisis trend that re ected in part de-risking by advanced-economy banks (Figure 4B). Commodity markets: further price increases. Brent oil, the main international marker, reached $59/bbl in late September—up from an average of $50/bbl in August—before receding to the mid-$50s in mid-October (Figure 4C). e price uptick re ects the reduction of large surpluses due to rising oil demand and high compliance with the OPEC/non-OPEC production cut agreement. Metals prices, which strengthened slightly in September, are up 32 percent from a year ago, due to strong demand—particularly from China’s infrastructure and manufacturing sectors—and some production outages, notably Sources: Dealogic, Federal Reserve Bank of St. Louis, World Bank. A. VIX is the implied volatility of option prices on the U.S. S&P 500. Last environmentally-driven supply cuts by China. Agricultural prices observation is October 23, 2017. B. Last observation is October 23, 2017. have been broadly stable, re ecting well-supplied markets. C. Metals index includes aluminum, copper, lead, nickel, tin, zinc, and iron ore. Last observation is September 2017. Crude oil index is the average price of Brent, Dubai, and West Texas Intermediate, equally weighted. 5 October 2017 Special Focus: Spillovers from Recovery FIGURE 5A GDP growth by country group in Major Economies Synchronized recovery. Global growth has been recovering since mid-2016, re ecting a pickup in major advanced economies and diminishing obstacles to activity in key commodity-exporting EMDEs, amid robust growth in China and India (Figure 5A). is combined acceleration of activity in major advanced economies and EMDEs is a source of positive spillovers for the rest of the world. Advanced-economy spillovers. Advanced economies continue to be the largest source of international spillovers. In particular, G7 FIGURE 5B Impact of 1-percentage-point increase countries account for almost half of global GDP and more than in EM7 and G7 growth on global growth half of global trade, and play a central role in international nance. At the end of 2014, more than half of global banking assets and liabilities were on G7 banks’ balance sheets. e G7 accounted for one-third of global foreign direct investment and almost half of global portfolio investment. us, nancial ows can quickly transmit shocks emanating from G7 economies around the world. Estimated spillovers using a Bayesian vector autoregression model indicate that a 1-percentage-point positive growth shock in G7 growth raises global growth by 0.9 percentage point on impact and a cumulative 2.0 percentage points after one year (Figure 5B).1 EM7 spillovers. e global impact of growth shocks in the seven FIGURE 5C Impact of 1-percentage-point increase largest EMDEs (China, India, Brazil, Russia, Mexico, Indonesia, in EM7 and G7 growth on growth in other EMDEs and Turkey) is smaller than those originating in the G7. Nevertheless, the e ect is signi cant for other EMDEs (Figure 5C). In fact, the EM7 economies constituted more than one- quarter of global output and accounted for more than half of global output growth during 2010–15. A 1-percent growth shock in the EM7 is associated with a 0.8 percentage point increase in growth in other EMDEs after 1 year, and a 0.6 percentage point increase in global growth over the same period. Among the EM7 economies, spillovers from China are the largest and permeate globally. is re ects the large size of the Chinese economy, which is, for example, more than four times larger than Brazil’s. Sources: Huidrom, Kose, and Ohnsorge (2017); World Bank. China’s imports are six times those of Russia and its demand for A.-C. EM7 includes Brazil, China, India, Indonesia, Mexico, the Russian Federation, and Turkey. G7 includes Canada, France, Germany, Italy, Japan, the primary energy and metals is, respectively, four to ten times that United Kingdom, and the United States. A. Aggregate growth rates calculated using constant 2010 U.S. dollars GDP weights. Last observation is 2017Q2. of India. B. Cumulative impulse responses of a 1-percentage-point increase in EM7 and G7 growth on global growth. The impact is the GDP-weighted average of the responses of EM7, other EMDEs, and G7 countries. Solid bars represent 1Estimates from: Huidrom, R., M. A. Kose, and F. L. Ohnsorge. 2017. “How Important medians, and error bars represent 16-84 percent confidence intervals. C. Cumulative impulse responses of a 1-percentage-point increase in EM7 and Are Spillovers from Major Emerging Markets?” Policy Research Working Paper 8093, G7 growth on growth in other EMDEs. Solid bars represent medians, and error World Bank, Washington, D.C. bars represent 16-84 percent confidence intervals. 6 October 2017 Recent Prospects Group Publications Global Economic Prospects - January 2018 (forthcoming) Commodity Markets Outlook - October 2017 (forthcoming) Global Economic Prospects - June 2017: A Fragile Recovery Commodity Markets Outlook - April 2017 Recent World Bank Working Papers Corporate Debt Maturity in Developing Countries: Sources of Long- and Short-Termism Revisiting the National Innovation System in Developing Countries Demand and Supply Curves in Political Markets: Understanding the Problem of Public Goods and Why Governments Fail Them Oil Discovery and Macroeconomic Management: The Recent Ghanaian Experience An Evaluation of Border Management Reforms in a Technical Agency Trade Creation and Trade Diversion in Deep Agreements Measuring the Effectiveness of Services Delivery: Delivery of Government Provided Goods and Services in India Unequal Laws and the Disempowerment of Women in the Labor Market: Evidence from Firm-Level Data Regulatory Constraints to Agricultural Productivity Recent World Bank Reports World Development Report 2018: LEARNING to Realize Education’s Promise Trouble in the Making? The Future of Manufacturing-Led Development TABLE A: Major Data Releases (Percent change, y/y) (Percent change y/y) Recent releases: September 29, 2017 - October 23, 2017 Upcoming releases: Oct 24, 2017 - November 23, 2017 Country Date Indicator Period Actual Forecast Previous Country Date Indicator Period Previous United Kingdom 9/29/17 GDP Q2 1.5 % 1.7 % 1.8% Australia 10/24/17 CPI Q3 1.9 % South Korea 10/2/17 CPI SEP 2.9 % 2.4 % 3.7% United Kingdom 10/25/17 GDP Q3 1.5 % Thailand 10/3/17 CPI SEP 0.9% 0.4 % 0.3% South Korea 10/25/17 GDP Q3 2.7 % Philippines 10/4/17 CPI SEP 3.4 % 3.2 % 3.1% United States 10/27/17 GDP Q3 2.2 % Luxembourg 10/4/17 CPI SEP 1.8% 1.7% France 10/31/17 GDP Q3 1.8 % Netherlands 10/5/17 CPI SEP 1.5 % 1.8 % 1.4% Mexico 10/31/17 GDP Q3 3.0 % Switzerland 10/5/17 CPI SEP 0.7 % 0.5% South Korea 10/31/17 CPI OCT 2.9 % Luxembourg 10/6/17 GDP Q2 2.2 % 3.3% Thailand 11/1/17 CPI OCT 0.9% Brazil 10/6/17 CPI SEP 2.5% 2.5% 2.5% Indonesia 11/1/17 CPI OCT 3.7% Czech Republic 10/9/17 CPI SEP 2.7 % 2.7 % 2.5% Turkey 11/3/17 CPI OCT 11.2% Romania 10/10/17 GDP Q2 5.9 % 5.9 % 5.7% Indonesia 11/5/17 GDP Q3 5.0% Greece 10/10/17 CPI SEP 1.0 % 1.1 % 0.9% Netherland 11/14/17 GDP Q3 3.8 % Romania 10/11/17 CPI SEP 1.8% 1.6 % 1.2% Germany 11/14/17 GDP Q2 2.1 % France 10/12/17 CPI SEP 1.0 % 1.05 % 0.9% Romania 11/14/17 GDP Q3 5.9 % Sweden 10/12/17 CPI SEP 2.3 % 2.3% Poland 11/14/17 GDP Q3 3.9 % Poland 10/12/17 CPI SEP 2.2 % 3.6 % 1.8% Euro Area 11/14/17 GDP Q3 2.3 % United States 10/13/17 CPI SEP 2.2 % 2.2 % 1.9% Greece 11/14/17 GDP Q3 0.8 % China 10/15/17 CPI SEP 1.6 % 1.6 % 1.8% Philippines 11/14/17 GDP Q3 6.5 % New Zealand 10/16/17 CPI Q3 1.9 % 1.7% 1.7% Malaysia 11/17/17 GDP Q3 5.8 % United Kingdom 10/17/17 CPI SEP 3.0 % 3.0 % 2.9% Thailand 11/20/17 GDP Q3 3.7 % Euro Area 10/17/17 CPI SEP 1.5 % 1.5 % 1.5 % Germany 11/23/17 GDP Q3 2.1 % 7 October 2017 TABLE B: Activity and Inflation (Percent change y/y, e xcept quarterly data on industrial production, which are percent change q/q, annualized) 2016 2017 2016 2017 2015 2016 Q3 Q4 Q1 Q2 Sep Oct No v Dec Jan Feb Mar Apr May Jun Jul Aug Industrial Production, sa 1 World 1.8 2.1 2.8 5.5 3.8 5.3 2.0 2.2 3.3 3.7 3.1 3.4 4.1 4.1 4.6 4.3 4.3 4.2 Advanced Economies 0.2 0.2 1.6 3.9 1.6 4.4 0.3 0.2 2.0 2.5 1.1 2.2 2.3 2.5 3.2 3.0 2.9 3.0 Emerging Mar ket and Developing Economies 3.5 4.1 3.9 7.0 6.1 6.2 3.8 4.1 4.6 4.9 5.2 4.7 5.9 5.6 6.1 5.7 5.7 5.5 Commodity -exporting EMDE 0.2 1.2 3.0 4.9 3.1 5.5 1.1 1.3 2.3 3.3 2.9 2.3 3.2 4.1 5.4 2.9 3.7 3.8 Other EMDE 5.0 5.3 4.2 8.0 6.8 6.4 4.8 5.2 5.6 5.6 6.1 5.6 6.7 6.1 6.3 6.6 6.3 6.0 East Asia and Pac ific 5.8 5.8 5.7 6.1 7.2 6.4 5.5 5.6 5.9 6.0 6.1 6.1 7.3 6.2 6.3 6.5 5.9 5.6 East Asia excl. China 3.5 4.5 3.4 3.4 4.6 1.7 2.2 2.5 4.3 6.1 4.5 4.8 5.5 4.2 5.1 0.6 3.0 3.1 Europe and Central Asia 1.5 2.0 - 1.1 8.9 5.6 8.0 0.8 1.6 2.8 2.7 4.4 1.5 4.4 4.4 6.5 4.9 6.6 6.2 Latin A mer ica and Caribbean - 3.1 - 2.9 0.2 - 0.6 0.8 1.2 - 1.8 - 2.8 - 0.8 1.0 0.1 0.5 - 0.7 0.0 1.1 0.1 0.3 1.4 Middle East and North Africa 2.8 - 8.7 - - - 4.3 6.5 - - - - - - - - - - South Asia 3.5 5.2 - 2.1 6.7 5.2 3.1 3.9 4.4 5.2 2.8 4.2 1.9 5.4 4.6 4.2 0.8 3.9 4.6 Sub - Saharan Africa 0.1 0.8 - 4.3 - 1.4 - 4.2 3.7 - 0.3 - 1.0 0.9 - 1.1 0.4 - 2.6 - 2.3 - 0.5 - 1.9 - 2.4 - - Inflation, sa 2 World 1.4 1.3 1.3 1.6 2.4 2.1 1.4 1.5 1.6 1.8 2.3 2.4 2.6 2.3 2.1 1.9 2.0 2.1 Advanced Economies 0.1 0.3 0.4 0.8 1.6 1.4 0.5 0.6 0.7 1.1 1.5 1.8 1.6 1.9 1.5 1.2 1.4 1.5 Emerging Mar ket and Developing Economies 2.5 2.3 2.8 2.5 3.4 3.3 2.9 2.4 2.4 2.6 2.9 3.3 3.5 3.5 3.3 3.0 2.9 3.3 Commodity -exporting EMDE 3.7 3.5 3.2 3.2 3.4 3.4 3.1 2.9 2.9 3.0 3.3 3.4 3.5 3.7 3.6 3.3 3.3 3.5 Other EMDE 1.0 1.1 1.7 1.7 3.1 3.1 1.6 1.6 1.6 1.8 2.6 3.3 3.5 3.2 3.1 2.5 2.5 3.0 East Asia and Pacific 1.2 1.7 2.1 2.3 2.7 2.9 2.2 2.1 2.2 2.5 2.7 3.2 3.4 3.2 3.2 2.5 2.5 3.2 Eur ope and Central Asia 1.9 0.4 0.5 1.0 2.4 2.3 0.5 0.9 0.9 1.6 2.3 2.5 2.7 2.6 2.3 2.2 2.4 2.6 Latin A merica and Caribbean 2.7 2.4 3.0 3.2 3.4 3.1 3.1 3.0 3.2 3.2 3.1 3.3 3.2 3.5 3.0 2.7 2.7 3.2 Middle East and North Africa 1.9 2.2 2.3 2.0 2.5 1.8 2.5 1.9 2.0 1.8 2.2 2.5 2.9 2.0 2.0 1.5 1.3 1.5 South Asia 4.5 4.9 5.3 3.9 4.3 4.5 5.0 4.2 3.7 3.7 3.7 4.2 5.0 4.8 5.0 3.9 2.9 3.4 Sub - Saharan Africa 3.6 5.3 5.7 5.5 6.5 6.6 5.8 5.8 5.4 6.5 6.7 6.7 6.5 6.7 6.5 6.4 5.5 5.3 1 Industrial production is total production (may exclude construction). When data are unavailable, "industrial production, manufacturing" and "industrial production, manufacturing, non-durable manufacturing, petroleum and coal products, crude petroleum products" are used as proxies. 2 Median inflation rate for each grouping. TABLE C: Trade and Finance (Percent change y/y, except quarterly trade data, w hich are percent change q/q, annualized, and international reserves data, w hich are percent change over the prev ious period) 2016 2017 2016 2017 2015 2016 Q3 Q4 Q1 Q2 Sep Oct No v Dec Jan Feb Mar Apr May Jun Jul Aug Exports, Nom inal, US$, sa World - 11.6 - 3.0 0.3 8.1 20.3 2.8 - 0.7 - 3.2 5.0 4.0 11.0 7.6 13.0 3.9 11.2 7.7 10.2 10.3 Advanced Economies - 11.4 - 0.8 - 0.7 5.1 19.8 0.9 1.5 - 1.6 6.3 5.7 10.2 8.0 10.7 1.2 10.3 6.5 9.8 10.1 Emerging Mar ket and Developing Ec onomies - 11.9 - 6.6 2.0 13.9 21.2 6.4 - 4.4 - 5.7 3.0 1.6 12.5 6.8 17.3 8.9 13.0 10.0 10.9 10.7 Commodity -exporting EMDE - 24.2 - 9.2 7.2 26.3 46.0 - 11.3 - 1.5 - 5.5 7.7 7.8 26.5 19.7 24.5 13.8 20.4 11.2 17.4 17.2 Other EMDE - 3.7 - 4.6 0.2 9.5 12.8 14.0 - 5.0 - 5.2 1.8 - 0.4 7.6 2.3 14.7 7.1 10.3 9.5 8.6 8.4 East Asia and Pac ific - 3.5 - 6.1 - 0.2 10.7 13.5 15.9 - 7.0 - 5.9 1.8 - 2.1 8.8 2.2 15.6 8.9 11.3 9.3 10.4 8.1 Europe and Central Asia - 20.7 - 6.1 2.1 18.8 36.0 - 5.4 - 1.1 - 3.6 6.5 7.6 22.4 12.4 20.8 5.6 19.2 10.8 11.3 19.3 Latin A mer ica and Caribbean - 11.9 - 2.4 8.4 12.8 28.9 - 3.6 2.9 - 4.4 10.1 10.9 14.8 12.5 17.3 9.5 11.4 12.2 10.3 11.2 Middle East and North Africa - 27.1 - - - - - - - - - - - - - - - - - South Asia - 3.8 0.6 - 14.0 19.4 12.0 - 10.9 - 0.7 2.5 1.5 1.4 2.9 - 0.1 11.2 6.6 - 1.7 - 2.8 11.6 - 3.5 Sub - Saharan Africa - 26.9 - 14.8 - 3.0 29.5 47.1 - 15.1 - 2.6 - 9.5 0.9 3.4 22.6 25.8 19.9 8.6 14.0 13.1 - - Im ports, Nom inal, US$, sa World - 6.9 - 5.2 - 21.4 24.5 21.3 15.5 - 5.6 - 9.6 3.6 - 1.6 11.5 5.4 10.4 - 6.2 25.3 7.2 21.3 16.2 Advanced Economies - 12.7 - 3.3 - 1.9 2.7 21.3 2.4 - 1.6 - 4.9 2.7 1.5 9.7 3.4 9.3 2.0 10.3 5.1 10.9 9.2 Emerging Mar ket and Developing Ec onomies - 3.3 - 6.3 - 31.2 39.9 21.2 23.7 - 7.8 - 12.1 4.2 - 3.3 12.6 6.6 11.0 - 10.4 34.6 8.4 27.8 20.7 Commodity -exporting EMDE - 0.9 - 7.1 - 38.6 46.1 16.3 33.1 - 9.9 - 15.1 3.9 - 5.4 11.9 2.2 8.8 - 15.4 39.7 7.3 31.6 - Other EMDE - 11.5 - 3.1 2.1 20.8 39.5 - 3.3 0.0 - 0.1 5.3 4.3 14.9 22.9 18.8 11.0 17.4 12.4 15.3 14.3 East Asia and Pac ific - 13.1 - 3.6 6.0 22.2 49.7 - 10.8 0.1 - 0.6 6.0 5.7 17.0 33.7 20.5 12.6 17.9 13.5 15.7 13.9 Europe and Central Asia - 20.7 - 1.2 - 2.9 10.9 41.8 12.0 2.3 1.2 5.9 8.5 20.7 10.0 14.2 7.6 22.6 13.1 25.2 17.3 Latin A mer ica and Caribbean - 9.9 - 7.4 4.2 5.0 26.1 - 9.3 - 3.3 - 8.3 1.7 3.9 11.2 5.3 13.6 - 1.1 12.4 6.2 7.4 9.0 Middle East and North Africa 1.4 - - - - - - - - - - - - - - - - - South Asia - 13.2 - 5.3 11.8 59.0 32.7 10.4 0.2 9.5 12.0 2.7 14.8 21.5 40.5 41.6 30.1 11.6 19.4 19.3 Sub - Saharan Africa - 7.6 - 13.9 - 11.6 - 8.7 - - - 12.5 - 18.0 - 9.1 - 12.0 - - - - - - - - International Reserves, US$1 World - 5.9 - 1.2 0.4 - 3.4 1.7 2.2 0.2 - 1.1 - 1.7 - 0.6 0.7 0.3 0.7 0.8 0.9 0.5 0.8 0.5 Advanced Economies 0.6 4.4 1.4 - 2.5 3.4 2.9 0.9 - 0.7 - 1.5 - 0.2 1.5 0.4 1.5 1.2 1.2 0.5 0.8 0.4 Emerging Mar ket and Developing Ec onomies - 10.0 - 4.9 - 0.3 - 4.0 0.5 1.7 - 0.2 - 1.4 - 1.8 - 0.9 0.1 0.3 0.1 0.5 0.8 0.5 0.8 0.6 Commodity -exporting EMDE - 11.1 - - 0.2 - - - - 0.1 - 1.7 - 1.1 - - - - - - - - - Other EMDE - 9.3 - 5.8 - 0.4 - 4.6 0.6 2.0 - 0.3 - 1.2 - 2.2 - 1.2 0.0 0.3 0.2 0.6 0.9 0.5 0.9 0.7 East Asia and Pac ific - 11.3 - 7.3 - 0.7 - 4.9 0.4 1.6 - 0.4 - 1.3 - 2.4 - 1.2 - 0.1 0.4 0.1 0.8 0.8 0.1 0.9 0.6 Europe and Central Asia - 6.8 3.7 1.1 - 4.3 2.9 3.2 0.1 - 0.9 - 1.8 - 1.7 1.9 0.7 0.3 - 0.1 1.3 2.0 1.0 1.6 Latin A mer ica and Caribbean - 5.3 1.1 1.6 - 0.9 0.8 1.4 - 0.1 - 0.6 - 0.6 0.1 0.5 0.4 0.0 0.9 0.1 0.3 0.8 0.5 Middle East and North Africa - 17.1 - - 2.0 - - - - 0.5 - 2.6 - - - - - - - - - - South Asia 10.9 3.5 2.7 - 3.1 2.1 4.8 1.4 - 1.2 - 1.6 - 0.3 0.6 0.5 1.0 0.8 2.0 1.9 1.5 1.3 Sub - Saharan Africa - 12.0 - - - - - - - - - - - - - - - - - 1Total reserves excluding gold are used as proxies when total reserves data are unavailable. 8 October 2017 TABLE D: Financial Markets (Percent change y/y, except quarterly trade data, which are percent change q/q, annualized, and international reserves data, which are percent change over the previous period ) 2016 2017 2016 2017 MRV 1 2015 2016 Q3 Q4 Q1 Q2 Oct Nov Dec Jan Feb Mar Apr May June Jul Aug Sep Interest rates and LIBOR (percent) U.S. federal funds effective 0.13 0.40 0.39 0.45 0.70 0.95 0.41 0.41 0.55 0.66 0.66 0.79 0.91 0.90 1.04 1.15 1.15 1.16 1.16 ECB repo 0.05 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 US$ LIBOR 3-months 0.32 0.74 0.79 0.92 1.07 1.20 0.88 0.91 0.98 1.03 1.04 1.13 1.16 1.19 1.26 1.31 1.31 1.32 1.37 EURIBOR 3-months -0.02 -0.26 -0.30 -0.31 -0.33 -0.33 -0.31 -0.31 -0.32 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 U.S. 10-year Treasury yield 2.12 1.84 1.56 2.12 2.44 2.25 1.74 2.12 2.50 2.44 2.42 2.47 2.29 2.29 2.18 2.32 2.21 2.19 2.37 German Bund, 10 year 0.54 0.14 -0.07 0.18 0.35 0.30 0.03 0.22 0.30 0.34 0.32 0.39 0.25 0.36 0.28 0.55 0.42 0.41 0.43 Spreads (basis points) JP Morgan Emerging Markets 415 410 372 369 340 325 357 380 370 354 338 329 331 320 325 327 325 314 306 Asia 224 221 197 197 175 169 192 201 198 185 173 166 173 167 166 163 163 157 146 Europe 348 302 282 283 261 242 274 294 282 272 258 253 250 237 240 243 234 224 224 Latin America and the Caribbean 540 537 477 475 445 427 453 491 481 463 442 431 431 420 430 435 435 416 410 Middle East 456 517 508 467 396 362 487 475 438 416 396 377 350 353 382 382 382 384 379 Africa 415 518 461 436 389 386 441 444 422 401 387 380 400 376 383 394 378 367 357 Stock indexes (end of period) Global (MSCI) 399 424 418 424 449 465 413 413 424 433 445 449 455 464 465 478 478 487 495 Ad vanced economies ($ index) 1663 1761 1726 1761 1854 1916 1697 1712 1761 1792 1839 1854 1878 1912 1916 1961 1960 2001 2030 United States (S&P 500) 2044 2258 2168 2258 2363 2423 2139 2199 2258 2279 2364 2363 2384 2421 2423 2470 2472 2519 2565 Europe (S&P Euro 350) 1474 1475 1388 1475 1547 1534 1377 1388 1475 1463 1501 1547 1564 1576 1534 1526 1512 1571 1583 Japan (Nikkei 225) 18817 19302 16450 19302 18909 20033 17050 18604 19302 19035 19342 18909 19197 19836 20033 19974 19720 20356 21666 Emerging market and 794 861 903 861 958 1011 908 863 861 909 936 958 978 1005 1011 1066 1088 1082 1116 developing economies (MSCI) EM Asia 404 419 448 419 474 512 444 426 419 443 459 474 484 505 512 538 544 543 566 EM Europe 244 295 273 295 301 304 274 273 295 302 296 301 313 308 304 315 336 331 331 EM Europe and Middle East 211 248 233 248 252 251 232 230 248 253 249 252 259 255 251 261 274 268 268 EM Latin America & Caribbean 1830 2341 2381 2341 2611 2544 2608 2330 2341 2516 2600 2611 2601 2532 2544 2752 2873 2917 2891 Exchange rates (LCU / USD) Ad vanced economies Euro Area 0.90 0.90 0.90 0.93 0.94 0.91 0.91 0.93 0.95 0.94 0.94 0.94 0.93 0.91 0.89 0.87 0.85 0.84 0.85 Japan 121.00 108.80 102.36 109.63 113.63 111.10 103.72 108.90 116.28 115.03 112.96 112.91 110.02 112.36 110.91 112.31 109.78 110.80 113.38 Emerging market and developing economies Brazil 3.33 3.49 3.25 3.28 3.14 3.21 3.18 3.33 3.35 3.20 3.10 3.13 3.14 3.20 3.30 3.20 3.15 3.13 3.24 China 6.29 6.65 6.67 6.84 6.89 6.86 6.74 6.85 6.92 6.89 6.87 6.90 6.89 6.88 6.81 6.77 6.67 6.57 6.64 Egypt 7.70 10.12 8.87 14.71 17.82 18.10 9.25 16.34 18.56 18.68 17.01 17.76 18.09 18.10 18.11 17.92 17.75 17.65 17.65 India 64.14 67.19 66.94 67.39 66.97 64.48 66.73 67.60 67.86 68.06 67.01 65.83 64.52 64.46 64.45 64.44 63.97 64.46 65.02 Russia 61.34 67.06 64.61 62.95 58.67 57.17 62.57 64.25 62.03 59.76 58.42 57.83 56.53 56.88 58.10 59.72 59.42 57.66 57.52 South Africa 12.77 14.71 14.07 13.92 13.24 13.21 13.92 13.96 13.88 13.60 13.17 12.95 13.46 13.25 12.91 13.15 13.25 13.17 13.70 Memo: U.S. nominal effective rate 114.7 119.7 118.4 122.5 123.4 120.7 119.7 122.9 124.9 124.8 123.0 122.5 121.6 121.0 119.4 117.9 116.4 115.4 117.6 (index) 1 MRV = most recent value. TABLE E: Commodity Prices 2016 2017 2016 2017 MRV 1 2015 2016 Q3 Q4 Q1 Q2 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Energy 2 65 55 57 64 68 64 64 59 68 69 69 65 67 64 60 62 65 69 69 Non-energy 2 82 80 82 83 86 82 81 83 84 85 87 85 83 83 82 83 84 86 86 Agriculture 2 89 89 91 90 91 88 90 90 89 91 91 89 88 89 87 88 87 88 88 2 Metals and minerals 68 64 64 71 78 74 65 73 75 76 79 79 75 73 72 76 83 84 84 Memo items: Crude oil, average ($/bbl) 51 43 45 49 53 50 49 45 53 54 54 51 52 50 46 48 50 53 55 Gold ($/toz) 1161 1249 1334 1221 1219 1258 1267 1238 1157 1192 1234 1231 1267 1246 1260 1237 1283 1314 1314 Baltic Dry Index 711 676 736 994 938 1023 870 1080 1031 913 760 1142 1229 979 861 906 1144 1363 1582 Source: World Bank, World Bank Commodities Price Data (The Pink Sheet), Bloomberg 1 MRV = most recent value. 2 Indexes, 2010 = 100. © 2017 International Bank for Reconstruction and Development / e World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved is work is a product of the sta of e World Bank with external contributions. e ndings, interpretations, and conclusions expressed in this work do not necessarily re ect the views of e World Bank, its Board of Executive Directors, or the governments they represent. e maps were produced by the Map Design Unit of e World Bank. e World Bank does not guarantee the accuracy of the data included in this work. e boundaries, colors, denominations, and other information shown on these maps do not imply, on the part of e World Bank Group, any judgment on the legal status of any territory, or any endorse- ment or acceptance of such boundaries. 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