EM growth: Slight pick-up in 2017 - Commerzbank

EM aggregate GDP growth in 2017 is likely to print at levels around 4.6% y/y which is higher than 2016 (4.2%), albeit well below levels recorded before the EM slowdown in 2013 expects research team at Commerzbank.

Key Quotes

“As a result the EM-DM growth differential will likely widen, marginally, in favour of EM. The higher aggregate EM GDP prints are the result of base effects; Heavyweight economies such as Brazil and Russia should finally recover from the deep recessions of 2015/16. We expect both economies to post growth of 0.8% and 1.3% respectively in 2017.  This compares favourably with GDP declines (Brazil,-3.3%) (Russia, -0.8%) in 2016. Even South Africa shows signs of positive momentum and should post growth in the region of 1.3% for 2017, having posted a mere 0.4% in 2016. These changes are enough to lead to higher EM aggregate growth in 2017.”