Big-name investors including billionaire James Packer, SEEK co-founder Paul Bassat, fund manager David Paradice and the Prime Minister’s son Alex Turnbull are backing taxi-booking app GoCatch to launch a new ride-sharing service in Australia.
Investors have to acknowledge a new set of risks tied to socioeconomic concerns that go far beyond the realm of traditional geopolitical hazards and have the potential to roil economic activity and financial markets. The confluence of new and old political risks threatens to undermine progress made through globalisation and foster a rise in conflict between, as well as within, nations. That is the ominous conclusion of Citibank’s team of analysts and the Carnegie Europe think tank. Such traditional geopolitical risks as armed conflict and newer socioeconomic risks like income inequality, threaten to intersect in an environment where global growth is stagnating while public expectations remain high and government capacity to effect positive change through reforms is low.
Continue reading below:Newell Palmer - Monthly Economic Notes February 2016
Global growth is expected to remain fragile in 2016. Global trade and manufacturing activity will likely struggle, and additional growth scares should be expected. This will play out within the global macro economic themes of low inflation and global policy divergence. Across the developed world, deflation scares of 2015 are expected to give way to an environment of low, but no longer falling, inflation. The bulk of the oil price plunge has likely already occurred and the gradual fall in unemployment should stabilise or increase wage inflation, ensuring that deflation is less of a risk. The US Fed is expected to continue raising interest rates whilst other central banks continue stimulus. The US economy is expected to remain resilient and there would be continued expansion in Europe and Japan.
Continue reading below:Newell Palmer - Monthly Economic Notes January 2016