Low Growth In Europe To Affect Emerging Economies

by khalid on 26/10/2011 · 0 comments

The European summit and the G20 meeting to be held in November should be able to bring a good solution for the European markets. Despite the markets have seen a relief rally the growth in the European markets would still be slower and lower. The slow growth in the European markets is expected to affect the emerging markets. The valuations across all the Emerging markets are pretty low and it will be tough for them to bring a sharp pullback. The experts seem to suggest that the emerging markets equities will be seen underperforming and the developed equities are expected to perform much better than them.

At the current levels the markets seem to be optimistic about the situation in Europe and the discussions that are going to take place in the G20 summit next month. Everyone expects some positive outcome from the summit which could bring some solution to the problem surrounding the Euro Zone. If Germany agrees to have a distributive fiscal regime in Europe than the one can expect to have a prolonged fiscal austerity in almost all countries across Europe.

Though the investors can witness a short term relief rally at the moment, the medium term growth for the European region looks to be low and this will have a severe impact on most of the emerging economies. The only good news for the emerging economies is that the commodity importers will see some gains from the decline in prices of commodities for the medium term.

Bell The Bull says: The G20 summit can bring some relief to the European Markets, by bringing some strong strategies

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