Economic slowdown

In my latest article, "World economy slows", I wrote: "If there were any doubts that the world economy is decelerating, they must all have been dispelled by now."

There's more news in The Straits Times today to corroborate that view.

The Federal Reserve Bank of New York reported yesterday that the business conditions index of its Empire Manufacturing Survey fell to 12.6 this month from last month's 35.8 and the lowest reading this year.

Some opinions from economists on the state of the US economy extracted from The Straits Times today:

[W]e see reasons why the slowdown is likely to prove more persistent. — Jan Hatzius et al, Goldman Sachs.

A best-case scenario is that the economy is decelerating sharply in the current quarter, but is still on track to achieve above-trend growth in the second half. — Kathleen Camilli, Camilli Economics.

The enthusiasm is calming but things are still growing and strong. — Tim Rogers, Briefing.com.

And on the world economy:

As I see it, the risks on the downside outweigh those on the upside by a factor of three to one. I would now assign a 40-percent probability to a recessionary relapse in the global economy next year. — Stephen Roach, Morgan Stanley.

It is premature to conclude that the world economy is heading for a serious slowdown. We still need more evidence to be worried. — Chua Hak Bin, DBS.

What we are seeing is a deceleration in growth momentum in several countries. It is not a sharp slowdown in economic activity, but a slight moderation in growth. — P. K. Basu, Robust Economic Analysis.

And on the Singapore economy:

[T]hanks to China, the rest of Asia is well-positioned to ride out any slowdown in the world economy...For Singapore's external sectors, things are hunky-dory. — P. K. Basu, Robust Economic Analysis.

I generally agree with those in the camp who see some moderation in growth, but it is not going to be serious...we will still see the lower end of the government's recently revised 8 to 9 percent growth forecast. — Choy Keen Meng, National University of Singapore.

So the consensus view is that there is a slowdown, but the exact severity is still a question mark.