Goldman says the global GDP recovery is taking off

 
Tim Wallace
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THE GLOBAL economy’s zig-zag phase of repeated periods of growth and contraction is at last coming to an end, with the UK one of the economies pushing its way out of stagnation, top economists at Goldman Sachs said yesterday.

At the start of 2011 and 2012, Goldman’s own leading index saw an upturn in the world economy, followed by renewed downturn.

But now it believes that gloomy cycle has been broken with a stronger and more sustained rise in its index pointing to a real recovery at last.

The economists are even more optimistic in the medium term, forecasting a fall in oil prices down to $85 per barrel by 2016 on the back of the shale revolution, helping cap inflation.

The Eurozone remains a weak area, and Goldman expects a 0.2 per cent contraction in its GDP this year, followed by a very slow increase in 2014.

But the picture for the UK is more positive, with growth of 1.4 per cent forecast for this year.

“Data from the ONS probably understates the pace of growth – we expect positive revisions,” said economist Huw Pill.