Pimco - PIMCO Cyclical Outlook: Policy Dissonance and Geopolitical Risk Beget Economic Decoupling

Summary

- Our economic forecast for the next 12 months calls for a continuation of a low amplitude, long frequency U.S. business cycle recovery, with growth between 2.5% and 3.0%. 

- The eurozone economy should grow by about 1% in the next 12 months, continuing a painfully slow climb out of a double-dip recession. 

- We expect Japan will grow by around 1% to 1.5% in the next 12 months, and China's growth is likely to slow to around 6.5%. The outcomes for other developing economies will be tied to what happens in China next year.