财年经济展望（英文版）.pdf

FY2018, FY2019 Economic Outlook - Despite the ongoing expansion of the global economy, keep a close eye upon protectionism and risks of higher interest rates - May 17, 2018 Copyright Mizuho Research Institute Ltd. All Rights Reserved. Key points of our forecast  The global economy is forecast to remain on an expansion track in 2018 and continue to follow firm footing in 2019. However, the growth momentum will gradually moderate due to the slowdown of the Chinese economy and peak-out of the IT cycle.  Even though Jan-Mar quarter growth fell sharply for Japan, the US and Europe, the slowdown should prove to be temporary and start to pick up from the Apr-Jun quarter mainly in the US where policy measures such as tax cuts are expected to have effect.  The risks to growth are the spread of protectionism, rise in long-term interest rates, escalation of Middle East tensions, and rise in crude oil prices.  As for protectionism, the US is exerting stronger external pressures regarding trade principally toward China. Should US-China trade frictions escalate, it would serve as negative pressures not only upon the US and China but upon the global economy as well.  There are risks of the rise in US long-term interest rates due to mounting inflation expectations stemming from the rise in crude oil prices and concerns regarding supply constraints. The rise in US long-term interest rates will lead to the rise of capital outflow pressures from the stock market and emerging market (EM) countries and serve as downside risks upon the economy.  Turning to the Japanese economy in FY2018 and FY2019, despite a gradual moderation of growth, the economy should continue to follow a gradual recovery. Keep a close eye upon the shift of corporate business sentiment toward a cauti