Bank of America continue to...>

GLOBAL MARKET/OPINION: Bank of America continue to cut their global growth

forecasts:

- BofA revise lower their US and Euro area, placing further pressure on their

2020 global growth forecasts, now down to -4.2%.

- They write that extended lockdowns, weak external demand, the collapse in

commodity prices and debt sustainability concerns will weigh on emerging markets

also. They also drop their forecast for 2021 recovery by 200bps.

- For the US, they now see Q2 real GDP growth contracting by 40% on a SAAR basis

and see GDP falling 8% in 2020 followed by a 4% increase in 2021.

- For the Eurozone, BofA cut our Euro area GDP growth forecasts to -8.3% in 2020

(from -7.6%) and 4.8% next year (from 8.3%). They add that fiscal policy still

falls short of needs, meaning pressure on corporates, hence on capex. 

- For China, the recent re-escalation of US and China trade tensions has sparked

worries of an imminent breakdown in the Phase-1 trade deal and faster decoupling

of the two big economies.