G10, Real GDP YOY%
2016201720182019E2020E2021E
G10, Real GDP YOY%1.72.42.121.81.8
Australia2.12.82.82.82.72.7
Canada1.532.121.71.8
Denmark20.92.31.91.61.8
Japan0.92.10.90.50.7
New Zealand3.82.72.72.82.82.9
Norway-0.83.81.62.321.9
Sweden2.62.61.721.91.9
Switzerland1.51.72.21.71.71.7
United Kingdom1.91.81.51.61.5
United States1.52.22.51.91.8
[Negative] Teg: Sweden

Growth will likely remain in 2018 as it was back to 2017. With interest rates in the country at -0.5%, holding cash in bank cost people some money, curiously but true. They need to reconsider monetary and fiscal policy to boost growth. Negative rates are widely criticized but Sweden seems not to turn against negative rates, as they just do not want to cap output and lessen real wages. I would argue on the efficiency of such a policy (this only gives the opportunity to earn by the government with tax and lessened obligations to pay on any debt - Sweden officials are collecting too much tax)

[Positive] Teg: Japan

I think the government will continue the course of economic revival, which provides bold monetary and flexible fiscal policies, as well as structural reforms. Extension of these policies in 2018-2019 will mean that by 2020 Japan will have completed its longest period of economic recovery since the 1980s. The government will continue to implement structural reforms, however, I think it will be difficult for the country to achieve its ambitious goal of expanding the economy to $6 trn to 2021. In spite of the last weak results of private consumption and investment spending, I expect that Japan's real GDP will show stable growth averaging 1.2% a year in 2018-2022, given by the continued support of flexible fiscal policy and steady growth in external demand. In addition, in 2018-2022 I expect surplus in trade account provided by global goods export growth, restarting of more nuclear power plants, as well as increasing tourist arrivals, especially due to Olympics in 2020.

[Positive] Teg: Canada

European import is the main driver for the economy of Canada. As per official sources of EU officers they are not expect any increase of imports of goods. In contrary China and US market's tend to increase import from Canadian business. Thus, I put moderate increase in GDP for the next 2 years

[Negative] Teg: Japan

I expect that Japan economy will continue to grow with growth rate approximately equals to average growth rate in 2012-2017 (Abenomics beginning). The key driver for this is export growth (machinery, chemicals, and non-ferrous metals) due to weak yen and global economy growth. Monetary situation remains healthy as well: despite recent acceleration in inflation, its forecast is still below BoJ target. However, one should note several challenges for Japan economy: 1) Near-term challenges: (1) recent strengthening of yen that increases Japanese exporters concern, (2) weakness in consumer spending due to wages decreasing, as well as new housing construction falling. 2) Fundamental long-term challenge: planned increasing of national sales tax in 2019 from 8% to 10% to cover deficit in pension system (due to Japanese demographic situation). I assume that this will lead to economic growth slowing down (as in 2014 when this tax was increased from 5% to 8%)

[Neutral] Teg: Japan

In Japan, growth trend is set to be maintained in 2018, but weaken thereafter as fiscal policy will benefit from planned consumption tax increase. I revised the growth less than 1% for the next years. As I think there is only one possibility to climb at 1% on even more is the expected growth of Global Demand, obviously from Main 3 (USA, China, EU). As per the USA and China - new incentives over softening of tax burdens on corporates - expected to be aggressive using Trump's words. Thus, import is the main driver for the economy of Japan. As It is easy to overestimate the influence of imports, I would tag neutral on the economy of Japan.

[Negative] Teg: United Kingdom

I think that the negative merchandise trade balance will remain the current account in deficit over 2018-2022, offsetting surpluses on the services account. More importantly I expect that UK economy will slowing down its growth since 2021 against the backdrop of the looser trade relations with the EU to mean a larger goods trade deficit and a smaller services surplus. Also I don't believe that UK's policymakers will be able to implement structural reforms in the near-term that have crippled the economy in recent years, including weak productivity growth, ineffective innovation and poor infrastructure. So my outlook on British economy is negative.

[Negative] Teg: Switzerland

The economy of Switzerland is standing still. I can not find any measurable drivers for upturn more that 1% GDP growth pre annum. Moreover, uncertainty over possible changes in income tax for firms provides some risk. Analysts estimates as 50-50 that the government would increase corporate taxes to cover as more as possible the debt level

[Neutral] Teg: Canada

I expect that Canada will be able to continue its stable growth: IMF's forecast for GDP growth in 2018 is ~2.1%, unemployment rate is at the lowest level since 70s (5.8%). However, despite all these obvious signs of recovery, one should note some concerns: 1) NAFTA renegotiation. USA is very important market for Canada (2/3 of export) and, thus, NAFTA is very important agreement for Canada (that makes Canadian products competitive on US market). However, now the future of NAFTA is questionable. Moreover, taking into account Trump's protectionist policy, I consider the case for USA to withdraw from a treaty as rather probable. 2) Household debt. According to OECD, households in Canada have the highest debt-to-income ratio (> 100%) in the developed world. Coupled with the lowest unemployment rate, I consider these as a fundamental internal constraints for Canada's long-term growth. 3) US tax reform. On the one hand, this reform is likely to support US GDP growth and, consequently, Canada's GDP growth (as Canadian economy is heavily reliant on US economy). However, on the other hand, lower corporate tax was one of the Canada's competitive advantages (comparing with USA), and, consequently, this reform is likely to decrease foreign direct investments. 4) Higher US Fed interest rate. It is likely that US Fed will increase interest rate. And the net result for Canada is rather questionable. On the one hand, that will likely lead to Canadian dollar weakening and, thus, Canadian export support. On the other hand, US dollar strengthening will lead to world economy slowing down.

[Neutral] Teg: Canada

Economic growth rate I expect to slow in the next two years as household consumption and government spending slows. Recent developments in consumption has not been transferred to the increase in wages and I think that house prices will continues to slow, no considerable job growth (if any at all). They also did not announced any substantial government investments. Thus, I project the growth of Canadian economy to ease

[Neutral] Teg: Australia

All I know good news for export sector that is they are investing in new LNG (liquefied natural gas) capacity to carry it to China.

[Positive] Teg: Switzerland

I would suggest that in conformity with the manufacturing PMI (Purchasing Manager Index) which is at its highest since July 2010 and the services PMI also stands at very high levels. These leading factors give us positive signals for the economy of Switzerland in 2018-2019. Switzerland increases its export compared to others European countries. Internal consumption is expanding faster nowadays that in 2017 due to the decrease of unemployment rate and rising real wages. Thus, I think that real GDP of Swiss would show minimum 2% of growth in 2018

[Negative] Teg: United Kingdom

Private consumption slows due to increase of inflation which limits real spending's of households, all investments are depressed by Brexit. Gloomy projections of real GDP growth.

[Positive] Teg: Switzerland

I think that Switzerland's economy will further benefit from export growth and higher domestic demand. Due to global growth and weak CHF, export growth perspectives are favorable (especially in pharmaceutical industry). That growth supports recovery in industrial activity (PMI is at its highest since 2010), unemployment reduction and growth in real investments from business (as utilized capacity ~80%). However, there is one weak side of Switzerland's economy that I want to mention. Previously, real estate boom was one of the key factors for economy growth. As a result of this boom, one might see that real estate market is imbalanced: declining demand (high household debt, tighter conditions on mortgages), increasing oversupply

[Negative] Teg: Switzerland

Interest rates in the country are -0.75%, holding cash in bank cost people money. They need to reconsider monetary and fiscal policy to boost growth. Negative rates are widely criticized, I also would argue on the efficiency of such a policy

[Negative] Teg: Japan

The government announced a new annual economic policy package in June, which were added economic reforms and an investment strategy for revitalization of the country. However, I don't expect that this year's plan to stimulate the economy and decrease the fiscal deficit will be achieved, due to pressure from an ageing population. Anyway if implementation of the policy would be successful, I think all growth prospects would be overlapped by increasing tensions in global commerce caused by destructive US trade policy. Therefore it's not clear for me how this year's economic results could recover Japan's economy and achieve the government's measures to stimulate growth and inflation.

[Negative] Teg: United States

As the US economy is totally integrated into a global economy, Trumps efforts to bound imports of goods from China and Mexico would effect that in short-run the domestic US consumption should be reduced since the upward pressure of appreciated goods (we clearly understand how much of import good Americans consume. Thus, my estimation of real GDP to remain at a 1.8% in 2018 and 2% in 2019

[Negative] Teg: Australia

I scrutinizes over economist's outlook for the Australian economy in 2018, they are cautiously optimistic, driven largely by improving global conditions but I doubt that such a global conditions will improve. Indeed, do not see the solid reasons for it. Thus, I would put a negative tax on GDP. Also, not to forget the adverse statistic for household consumption in Australia which adds more uncertainty on it. I may refresh your memory - Australia has one of the highest debt-to-GDP ratios for houseless in the world. A little and sudden interest increase will lead to problems on debt servicing for households followed by well-known problems for economic growth

[Negative] Teg: United Kingdom

I would suggest that all situation over Skripal Case was done by internal forces of Great Britain itself, by the community against Teresa Mai. I believe that they just set her up (to make her as a scapegoat). This is the easiest way and method for internal political struggle. Well, this in coupe with high level of debt against European Union due to Brexit leaves us with no driver for growth in economy of Great Britain. At least, very modest opportunities.

[Negative] Teg: Canada

I think that exchange rate, commodity prices and strong US economy will keep deficit of the external account of Canada in 2018-2022. Apart from oil, I expect low commodity prices in coming years and this will make negative impact on the current-account. Now we see healthy private consumption, which supported by continued strong household spending against the backdrop of the low interest rates, cheap fuel and an improving labour market. However, monetary policy tightening and increasing prices on the energy resources will slowdown in the private consumption in the near-term. Therefore I forecast slowdown in economic growth of Canada in 2018-2022.

[Positive] Teg: United States

Only positive signal is that the USA tax policy changes (I mean corporate tax increase) that would probable boost the recovery of economy - positive impact. Unemployment rate is low and continues to be at its natural level (4-5%). According to the key economic indicators the outlook for the US economy is healthy. I would suggest the estimation of real GDP to be within 2-3% for 2018-2020. Nonetheless President Trump promised to increase growth to 4 per cent, let's see.