2020 and the Veil of Uncertainty

The global economic outlook deteriorated in 2019, following the downturn already seen in 2018. Between January and October, BBVA Research reduced its global growth forecast for 2019 and 2020 by 0.3 percentage points (pp) to 3.2% and 3.1%, respectively — half a point less than the average from 2011 to 2018.

Key points

• Key points:
• This reduction was the result of a combination of factors, with the positive aspects being outweighed by the negatives, whose impact could not be offset by demand policies.
• The central banks in the world's biggest economies took advantage of the room for maneuver offered by the absence of inflationary pressure, cutting interest rates.
• Meanwhile, fiscal policies aimed to boost activity, resulting in increased primary public deficits in these economies in 2016–2017 and 2018–2019, with the exception of Japan.

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