OECD issues a growth forecast but highlights risks

The OECD has issued a report indicating that it believes that the world economy will continue to grow and that this is opening the door to future rate hikes by central banks around the world. Despite this pronouncement,a variety of global political risks and economic problems can limit or reverse this growth and lead to s significant market downturn.

 

The article indicated the risk that the economy has of overheating and creating new bubbles in property prices they could cause long-term damage to the economy. Economic bubbles, When they inevitably burst, can reduce investor confidence and lead to long-term recessions and depressions in the market.

 

The OECD Issued a similar warning in Ireland back in 2006 before the recession hit. While the warning issued by the OECD is not as dire or significant, and fewer of the believe that the downtrodden to be a significant as the recession of 2007, and you’re taking this warning seriously. Back in 2006 the morning was not taken seriously.

 

Another risk for the market is the high level of private debt held by individuals across the world. People tend to spend more when they are confident of the economy and save money during down times. This leads to more significant down and upturns in the economic markets, which is Illustrated by the all time market highs.

 

There are also risks surrounding a lack of unemployment which can lead to inflation through increased wages. There are clearly a lot of risks that the market is facing globally.

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