Global economy to grow 2.9 percent: Fitch

By Muhammed Ali Gurtas

ANKARA (AA) - The global economy will grow by 2.9 percent in 2017, according to Fitch on Wednesday.

"We forecast a rise to 2.9 percent from 2.5 percent last year due to a recovery in US investment, a broad easing of developed market fiscal policy and recessions ending in Brazil and Russia," the international credit rating agency said.

According to Fitch's Global Credit Outlook View, however, growth prediction for the Eurozone this year was down to 1.4 percent from 1.6, while the prediction for China was down to 6.4 percent from 6.7.

The rating agency said that global rating outlooks were weaker than a year ago across most rating sectors while emerging market issuers encountered the hardest difficulties.

"This is a global trend with the outlook bias also negative for developed market entities across the majority of sectors," it added.

Fitch pointed out that 21 percent of its ratings among all countries had a negative outlook.

"Pressures include a strengthening US dollar, global trade weakness and policy uncertainty.

"Many commodity export-dependent countries in the Middle East and Africa also still struggle to adjust to the dramatic decline in prices, despite the recent recovery," it said.

Fitch went on to say that the European banks were faced with slow economic growth and high non-performing loans, especially in Italy and Portugal.

"The expected boost to US economic growth would be positive for corporates but the increased likelihood of rising interest rates is not," it said.

"In contrast, financial institutions stand ready to benefit from rising rates which should allow a widening of their net interest margin."

The agency is expected to reveal Turkey's credit note on Friday.