The World Bank recently cut its forecast for global growth this year due to weakness in the developing world—including in countries like Brazil and China—but the prospects for advanced economies, including the United States, are much better.
Drexel University’s Marco Airaudo, PhD, an associate professor of economics at the School of Economics in the LeBow College of Business, provided his own perspective on how he thinks the economy fared in 2015, and how he expects it to perform in the comin
“The U.S. has shown clear signs that we are out of the long recession,” Airaudo said. “This is partly reflected in the recent decision by the Fed to increase interest rates. With inflation pretty much under control and no excessive booms in the economic activity, the only motivation for moving interest rates away from the ‘zero lower bound’ floor is to signal optimism about future growth to market participants.”
How does Airaudo expect the stock market to perform in 2016? That is a bit harder to predict, he said. “On the one hand, real growth together with a positive interest rate differential with respect to other developed countries (Eurozone) might fuel a bullish market. On the other hand, there still seems to be a high uncertainty on what will happen in some emerging markets, as well as the beaten-up energy sector. I am expecting quite some volatility this year.”