‘Global economy will recover in early 2020’

Bloomberg

A combination of easing trade tensions and easier monetary policy will lift global growth from the first quarter of 2020, according to economists at Morgan Stanley.
Emerging markets will drive the recovery, given the late-cycle stage that US growth is in, they argue.
“A 1Q20 recovery is on the cards,” the US bank’s economists led by Chetan Ahya wrote in a note.
“Global growth should recover from 1Q20, reversing the downtrend of the past seven quarters as trade tensions and monetary policy are easing simultaneously for the first time since the downtrend began.”
Risks remain skewed to the downside, including the potential for more tariffs and late-cycle challenges in the US, including corporate credit risk and uncertainty around the elections.
If the Trump administration follows through on its threat to impose additional tariffs on Chinese goods in December, global growth will decelerate further in the final quarter of this year “and the recovery will be delayed until 3Q20,” the authors write. Still, a mini-cycle recovery should kick in next year.