Global Monthly April 2018

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•

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0

100

200

300

400

500

China exportsto U.S.

U.S. exportsto China

Total

Potentially impacted bynew tariffs

US$, billions

2

April 2018

Global economy: maturing upturn, gradual pickup in inflation.

Global growth was still solid in 18Q1, but showed signs of

moderation amid mixed incoming data in major economies.

Global capital spending, exports, and industrial production

continued to show momentum, but consumer spending softened.

In March, business and consumer confidence dropped from post-

crisis highs, while global PMI surveys fell appreciably, reaching a

16-month low as activity decelerated in both manufacturing and

services (Figure 1.A). Concerns about an escalating trade spat

between the United States and China impacted financial market

sentiment and increased policy uncertainty. Global inflation

remained moderate but increased gradually in 18Q1, supported

by higher oil prices and diminished global economic slack (Figure

1.B). Inflation picked up in major advanced economies and

commodity-importing EMDEs, but continued to decline in key

commodity exporters, as the impact of past currency

depreciations waned.

Global goods trade: strong gains, but rising policy uncertainty.

Global goods trade growth remained strong at the start of 2018,

supported by robust trade flows in Asia and across major

advanced economies. However, export orders weakened in March

to a 15-month low, indicating softening momentum toward the

end of 18Q1. On the policy front, risk of escalating trade

protectionism increased, following tariff announcements by the

United States and China. 5e impact of these measures will

depend on their ultimate scope; however, a rise in trade policy

uncertainty could itself weigh on confidence, financial market

sentiment, and eventually on activity (Figure 1.C).

United States: slowing growth, rising fiscal deficits. GDP

growth slowed to 2.3 percent in 18Q1 (q/q saar), from 2.9

percent in the previous quarter. 5e deceleration reflected weaker

consumer spending and export growth, partially offset by robust

business investment. Labor market conditions remained robust,

with employment gains averaging 202,000 in 18Q1, and the

unemployment rate stabilizing to 4.1 percent, its lowest level in

17 years. Survey data continue to point to sustained growth, with

consumer confidence remaining close to post-crisis highs in April.

Despite some moderation in Q1, export growth continued to

benefit from strong external demand and past depreciation of the

U.S. dollar. China’s announced retaliatory tariffs, if implemented,

Monthly Highlights

FIGURE 1.B Inflation in major advanced

economies and EMDEs

FIGURE 1.C U.S. trade policy uncertainty

Sources: Baker, Bloom, and Davis (2016); Haver Analytics; World Bank.

A. Last observation is March 2018 for manufacturing PMI and February 2018 for

industrial production.

B. World CPI is the median value. Last observation is March 2018.

C. Trade policy-related uncertainty in the United States is based on Baker,

Bloom, and Davis (2016), and computes the frequency of articles in domestic

newspapers mentioning terms related to trade policy (e.g., import tariffs, import

barriers, WTO, dumping, etc.). Last observation is March 2018.

FIGURE 1.A Global industrial production growth

and manufacturing PMI

3

April 2018

could affect up to $50 billion of U.S. exports to China, including

vehicles and aircraft, as well as soybeans and other vegetable

products. Fiscal stimulus measures are expected to support activity

in the near term, but are also contributing to a rapid increase in

budget deficits, which are expected to reach 4 percent of GDP in

2018 and increase to 4.6 percent in 2019 (Figure 2.A).

Euro Area: stabilizing confidence. 5e recovery in the Euro Area

continues, but recent data have been relatively soft. Following

exceptionally strong growth throughout 2017, the deceleration in

activity has been particularly visible in Germany, where retail sales

and industrial production dropped in 18Q1. Nonetheless, Euro

Area activity is still tracking above-trend growth amid

accommodative monetary policy, rising investment, and solid

credit growth. Although sentiment indicators remain robust, they

dropped in March and stabilized at a lower level in April,

following decade-long highs at the start of 2018 (Figure 2.B). 5e

unemployment rate continued to fall, reaching 8.5 percent in

February, while inflation picked up in March, to 1.3 percent (y/y),

but remains below the European Central Bank’s target.

Japan: mixed activity data, rising inflation. Industrial production

increased in February and March, but not enough to offset a sharp

fall in January, while the manufacturing PMI declined in February

and March, suggesting that growth slowed in 18Q1. However, the

all-firm Tankan business sentiment indicator improved and the

Manufacturing PMI increased marginally in April, pointing to the

possibility of a rebound in 18Q2. Inflation declined to 1.1 percent

(y/y) in March, while core inflation (excluding fresh food and

energy) remained subdued at 0.5 percent. Inflation expectations

are still well below the central bank’s target. In its April meeting,

the Bank of Japan kept rates unchanged, but dropped its

timeframe for reaching 2 percent inflation by fiscal year 2019.

China: resilient growth. Growth in 18Q1 remained stable at 6.8

percent (y/y), for the third consecutive quarter, supported by

strong consumer spending. Industrial production has been robust

so far this year, expanding by 6.8 percent (y/y) in 18Q1, up from

6.2 percent un 17Q4, but moderated in March. Credit growth has

continued to slow amid tighter regulation, but the impact on

activity has been limited (Figure 2.C). Lunar New Year effects

continued to distort China’s trade figures, but preliminary data for

March suggests that trade flows were robust in 18Q1. China

responded to proposed U.S. tariffs—affecting primarily exports of

FIGURE 2.B Euro Area economic sentiment

FIGURE 2.A U.S. budget deficits, revenues, and outlays

FIGURE 2.C China’s total loan growth

Sources: Congressional Budget Office (CBO), European Commission, Haver

Analytics, People’s Bank of China.

A. Shaded area indicates CBO forecasts.

B. Composite index measures the confidence level across manufacturers, service

providers, consumers, retailers, and constructors. Last observation is April 2018.

C. Data are end of period and are estimates for 2018Q1.

4

April 2018

machinery, mechanical appliances, and electrical equipment—

with countervailing measures, while filing a challenge under the

WTO dispute settlement mechanism. Consumer price inflation

eased slightly to 1.9 percent (y/y) in March, reflecting lower food,

tourism, and transportation prices, but has been on an upward

trend since a trough in early 2017.

Major commodity-exporting EMDEs: varying trends. Following

sustained improvements in 2017, incoming data for 18Q1

remained consistent with a gradual recovery in commodity

exporters, but with notable divergences across countries (Figure

3.A). Activity in Brazil lost some momentum, with industrial

production and retail sales growth moderating in February.

However, business sentiment improved in March and monetary

policy easing is providing ongoing support to domestic demand.

In Russia, the composite PMI dropped in March, and the ruble

depreciated sharply in April amid rising geopolitical concerns. In

Indonesia, a contraction in the chemical sector dragged down

industrial production in recent months, but the underlying

growth momentum remains strong. In Nigeria, survey data

picked up in March, pointing to strengthening activity in 18Q1,

while manufacturing activity decelerated in South Africa,

following solid gains in 17Q4. In Saudi Arabia, the composite

PMI remained stable in March following a sharp decline in

January when the new value-added tax was introduced.

Major commodity-importing EMDEs: sustained strength.

Activity generally remained robust in commodity importers

(Figure 3.B). In India, industrial production grew 7.1 percent (y/

y) in February, despite a slowdown in mining, while

manufacturing output gained 8.7 percent (y/y). However, the

manufacturing PMI fell in March, driven by weakening new

orders and hiring. Growth in Poland and Turkey was robust in

17Q4, and survey data point to continued, albeit softening,

momentum in 18Q1. Data in 1ailand are mixed, with strong

exports but moderating confidence. In Mexico, the flash estimate

for 18Q1 growth came in at 1.1 percent (q/q sa), up from 0.8

percent in 17Q4, supported by rising industrial activity. In Egypt,

industrial growth remained resilient, growing 12 percent (y/y) in

February, while inflation continued to decline in March.

Global financial markets: tightening. Prospects of further rate

hikes by the U.S. Federal Reserve and rising inflation expectations

pushed U.S. long-term yields to a four-year high of 3 percent

FIGURE 3.B Industrial production in selected

commodity-importing EMDEs

FIGURE 3.A Industrial production in selected

commodity-exporting EMDEs

FIGURE 3.C 10-year government bond yields

Sources: Bloomberg, World Bank.

A. B. Data reflect 3-month moving averages. Last observation is February 2018.

C. Last observation is April 30, 2018 for the United States and Germany, and

April 27, 2018 for Japan.

5

April 2018

100

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2010

2011

2012

2013

2014

2015

2016

2017

2018

Basis pointsSovereignCorporate

0

10

20

30

40

50

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70

EAP LAC MNA ECA SSA SAR

Jan-Apr 2017Jan-Apr 2018

US$, billions

2,300

2,400

2,500

2,600

2,700

2,800

2,900

40

50

60

70

Jun-

17Ju

l-17

Aug-

17Se

p-17

Oct

-17

Nov

-17

Dec

-17

Jan-

18Fe

b-18

Mar

-18

Apr-1

8Oil price, WTIU.S. equity index (RHS)

US$/bbl Index

6

April 2018

0

2

4

6

8

1998

-200

220

03-0

720

08-1

220

13-1

720

18-2

719

98-2

002

2003

-07

2008

-12

2013

-17

2018

-27

1998

-200

220

03-0

720

08-1

220

13-1

720

18-2

7

World AEs EMDEs

Potential growthActual growth1998-2017 potential growth

Percent

3.6

4.0

4.4

4.8

5.2

1.8

2.0

2.2

2.4

2.6

2013

-17

Con

tribu

tion

2018

-27

2013

-17

Con

tribu

tion

2018

-27

World EMDEs (RHS)

Percent BaselineDemographic trendsOther factors

Percent

0

25

50

75

100

World AEs EMDEs

Percent Share of countriesShare of GDP

7

April 2018

FIGURE 6.B Change in TFP growth 2-4 years after

reform episodes

FIGURE 6.A Potential growth under reform

scenarios

FIGURE 6.C Change in real investment growth 2-4 years after reform episodes

Source: World Bank.

A. –C. GDP-weighted averages. Derived using the methodology described in

Chapter 3 of the January 2018 Global Economic Prospects.

B. C. Regression coefficients of growth on dummies for structural reform

spurts and setbacks—defined as statistically significant changes in four

Worldwide Governance Indicators—from local projections model for lags of

two and four years, for a sample of 136 EMDEs and 38 advanced economies

during 1996-2015. Vertical bars show 90 percent confidence level.

EMDE by as much as their largest historical improvement in any

ten-year period. 5is would imply an average increase in second-

ary and tertiary enrollment rates of 7 percentage points over the

next decade, and an average rise in life expectancy of 2.5 years.

Increasing labor force participation. Labor supply can be raised

by drawing a greater share of the working-age population into the

labor force. 5is can be achieved through policies to “activate”

discouraged workers or groups with historically low participation

rates, such as women and young or senior workers. In the stylized

scenario, female labor force participation rates—along cohort-,

age-, and country-specific dimensions—are assumed to rise, over

the next decade, by the largest historical ten-year improvement in

each EMDE, although they are not assumed to exceed the rates of

same-aged men. On average, this would imply raising the female

labor force participation rate by 10 percentage points by 2027.

5e assumption underlying this result is that, over the decade,

sufficient jobs will be created to absorb this additional labor sup-

ply.

Estimated impact on potential growth. 5e stylized scenarios

above suggest that a combination of additional investment; better

educational and health outcomes; and labor market, business cli-

mate, and governance reforms could stem or even reverse the ex-

pected decline in potential growth over the next decade (Figure

6.A). 5e human and physical capital and labor market reform

scenarios above are associated with 0.7 percentage point higher

EMDE potential growth. 5is would more than offset the 0.5-

percentage-point slowdown in EMDE potential growth expected

under the baseline scenario. Projected gains from filling large in-

vestment needs in EMDEs could be particularly significant, con-

tributing to more than half the expected improvement.

Reform spurts, productivity, and investment growth. A renewed

drive for reforms could help lift potential growth even in the short

to medium run. Past reform spurts were followed by accelerating

productivity and investment growth. To illustrate this linkage, an

event study defines major reform spurts as those that significantly

improve governance or business climate indicators. Four years

after the reform spurts, TFP growth was about 0.3-0.5 percentage

points higher and investment growth about 2.8 to 3.5 percentage

points higher compared to their average in years without spurts

(Figure 6.B & C).

8

April 2018

Global Economic Prospects—June 2018 (forthcoming) Commodity Markets Outlook - April 2018: Oil Exporters: Policies and Challenges Global Economic Prospects - January 2018: Broad-Based Upturn, but for How Long? Global Economic Prospects - June 2017: A Fragile Recovery

Impact of Free Trade Agreement Use on Import Prices Sharing the Benefits of Innovation-Digitization: A Summary of Market Processes and Policy Suggestions Capital Inflows, Equity Issuance Activity, and Corporate Investment Returns to Investment in Education: A Decennial Review of the Global Literature Interest Rate Caps: The Theory and the Practice Paris Climate Agreement and the Global Economy: Winners and Losers Taxation and the Shadow Economy: How the Tax System Can Stimulate and Enforce the Formalization of Business Activities What Investors Want: Perceptions and Experiences of Multinational Corporations in Developing Countries The Performance of a Consumption Augmented Asset Index in Ranking Households and Identifying the Poor

The Changing Wealth of Nations 2018: Building a Sustainable Future

Doing Business 2018: Reforming to Create Jobs

World Development Report 2018: LEARNING to Realize Education’s Promise Women, Business and the Law

(Percent change, y/y) (Percent change y/y)

Recent releases: March 23, 2018 - April 25, 2018 Upcoming releases: April 26, 2018 - May 21, 2018

Country Date Indicator Period Actual Forecast Previous Country Date Indicator Period Previous

Netherland 3/26/18 GDP Q4 2.9 % 2.9 % 3.0% Iceland 4/27/18 CPI APR 2.8 %

France 3/26/18 GDP Q4 2.5% 2.3% Austria 4/27/18 GDP Q1 2.8 %

South Korea 3/27/18 GDP Q4 2.8 % 3.8 % France 4/27/18 GDP Q1 2.0 %

United States 3/28/18 GDP Q4 2.6 % 2.7 % 2.3 % UK 4/27/18 GDP Q1 1.4 %

Turkey 3/29/18 GDP Q4 7.4 % 10.5 United States 4/27/18 GDP Q1 2.6 %

UK 3/29/18 GDP Q4 1.4 % 1.4 % 1.8% Lithuania 4/30/18 GDP Q1 3.8 %

Denmark 4/5/18 GDP Q4 1.3 % 1.1% Spain 4/30/18 GDP Q1 3.1 %

Mexico 4/9/18 CPI MAR 5.0% 5.3% Mexico 4/30/18 GDP Q1 1.5 %

United States 4/11/18 CPI MAR 2.4 % 2.5% 2.2 % Latvia 5/1/18 GDP Q1 4.2 %

Sweden 4/12/18 CPI MAR 2.0 % 1.6% Indonesia 5/2/18 GDP Q1 5.2 %

Ireland 4/12/18 CPI MAR 0.2 % 0.5 % Italy 5/2/18 GDP Q1 1.6 %

Spain 4/13/18 CPI MAR 1.2 % 1.1 % Eurozone 5/2/18 GDP Q1 2.7 %

China 4/16/18 GDP Q4 6.8 % 6.9% Turkey 5/3/18 CPI APR 10.23 %

Italy 4/17/18 CPI MAR 0.8 % 0.5% Indonesia 5/7/18 GDP Q1 5.2 %

Croatia 4/17/18 CPI MAR 1.0% 0.8 % Brazil 5/10/18 CPI APR 2.7%

Austria 4/18/18 CPI MAR 2.0% 1.9% Cyprus 5/15/18 GDP Q1 3.9 %

South Africa 4/18/18 CPI MAR 3.7% 3.8% Germany 5/15/18 GDP Q1 2.9 %

UK 4/18/18 CPI MAR 2.5 % 2.7% 2.7 % Slovakia 5/15/18 GDP Q1 3.5 %

Japan 4/19/18 CPI MAR 1.1 % 1.2% 1.5 % Poland 5/15/18 GDP Q1 5.1 %

Canada 4/20/18 CPI MAR 2.3 % 2.2 % Portugal 5/15/18 GDP Q1 2.4 %

Australia 4/23/18 CPI Q1 1.9 % 1.9 % 1.9 % Thailand 5/21/18 GDP Q1 4.0 %

9

April 2018

TABLE B: Activity and Inflation (Percent change y/y, except quarterly data on industrial production, which are percent change q/q, annualized)

Sources: Haver Analytics, IMF International Financial Statistics, World Bank. 1 Industrial production is total production (may exclude construction). When data are unavailable, "industrial production, manufacturing" is used as a proxy. 2 Median inflation rate for each grouping.

TABLE C: Trade and Finance

Sources: Haver Analytics, IMF International Financial Statistics, World Bank. 1Total reserves excluding gold are used as proxies when total reserves data are unavailable.

2017 2018

2016 2017 Q1 Q2 Q3 Q4 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

Industrial production, sa 1

World 2.0 4.0 3.6 5.0 3.4 5.6 3.9 3.7 4.4 4.1 4.2 4.3 4.3 4.3 4.3 4.6 4.6 4.7

Advanced economies 0.1 2.8 1.6 4.4 2.1 5.5 2.3 2.5 3.5 3.1 3.0 3.1 2.9 3.3 3.2 3.6 2.8 3.3

Emerging market and developing economies 4.1 5.3 5.7 5.7 4.7 5.6 5.6 5.1 5.4 5.2 5.4 5.6 5.7 5.2 5.4 5.6 6.4 6.2

Commodity-exporting EMDEs 0.1 2.2 2.4 4.6 2.8 -0.4 1.4 2.4 3.4 1.4 2.3 3.4 3.1 3.1 2.0 1.9 2.1 1.1

Other EMDE 5.2 6.1 6.6 6.0 5.2 7.3 6.8 5.8 6.0 6.2 6.3 6.2 6.4 5.8 6.4 6.6 7.6 7.6

East Asia and Pacific 5.9 6.2 7.3 5.9 4.7 4.9 7.4 6.2 6.3 6.5 6.0 5.9 6.5 5.8 5.7 5.7 6.8 6.6

East Asia excl. China 4.7 4.0 5.7 0.7 7.6 -2.1 6.0 4.3 5.0 0.6 3.3 4.8 5.8 3.2 3.4 2.1 4.2 2.8

Europe and Central Asia 2.7 5.4 3.3 10.3 4.0 6.0 4.6 4.7 6.6 5.3 6.8 6.9 7.0 5.9 5.1 6.6 7.9 6.9

Latin America and Caribbean -2.2 0.7 1.2 0.0 3.0 2.9 -0.8 -0.4 0.2 0.7 1.0 1.7 0.6 1.8 1.3 2.2 1.5 2.1

Middle East and North Africa -7.0 18.5 24.2 22.9 20.0 10.4 4.8 21.1 20.4 23.4 30.7 15.5 19.5 18.8 22.9 16.2 8.2 9.1

South Asia 5.3 4.6 4.2 2.3 6.7 13.8 5.5 4.6 4.0 0.1 4.0 6.5 4.7 3.7 8.8 7.6 8.2 7.6

Sub-Saharan Africa 1.0 -0.2 -4.1 3.1 3.9 7.3 -2.1 -0.5 -1.8 -2.8 -0.7 1.2 -0.8 1.7 2.5 3.2 1.7 1.2

Inflation, sa 2

World 1.5 2.1 2.6 2.1 2.2 2.3 2.7 2.3 2.1 1.9 2.2 2.2 2.2 2.3 2.2 2.1 2.1 2.2

Advanced economies 0.3 1.4 1.6 1.4 1.4 1.4 1.6 1.9 1.4 1.2 1.4 1.4 1.5 1.4 1.5 1.5 1.5 1.4

Emerging market and developing economies 2.7 3.2 3.4 3.2 3.0 2.9 3.5 3.5 3.1 2.7 2.7 3.2 3.2 3.0 2.9 2.9 2.9 2.9

Commodity-exporting EMDEs 3.5 3.5 3.5 3.5 3.3 2.8 3.6 3.8 3.5 3.0 3.0 3.3 3.2 3.0 2.7 2.8 2.9 2.9

Other EMDE 1.1 2.9 3.0 2.9 2.8 3.1 3.3 3.2 2.9 2.3 2.5 2.8 3.2 3.1 3.2 3.1 3.7 3.5

East Asia and Pacific 2.1 2.9 3.0 2.8 2.2 2.7 3.6 3.2 2.6 2.3 2.3 2.6 2.5 2.8 2.6 2.6 2.3 2.7

Europe and Central Asia 0.4 2.4 2.4 2.3 2.7 2.8 2.8 2.6 2.3 2.2 2.5 2.7 2.8 2.6 2.8 2.8 2.5 2.7

Latin America and Caribbean 2.4 2.8 2.9 2.4 3.2 3.9 2.8 2.9 2.9 1.8 2.8 3.2 3.7 3.5 4.1 3.5 3.3 3.1

Middle East and North Africa 2.1 1.6 2.6 1.5 1.1 2.2 2.9 1.7 1.9 1.0 1.2 1.1 1.6 2.1 1.7 2.3 2.9 3.0

South Asia 4.4 3.8 4.3 4.5 3.6 3.8 4.9 4.7 5.0 4.0 3.6 3.7 3.5 3.7 4.0 5.2 5.1 4.4

Sub-Saharan Africa 5.3 5.1 6.3 5.3 4.8 4.4 6.0 5.3 5.4 5.4 5.3 4.8 5.1 4.9 3.3 3.2 3.1 3.0

2017

2017 2018

2016 2017 Q1 Q2 Q3 Q4 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

Exports, nominal, US$, sa

World -3.0 10.2 17.3 3.7 13.2 15.3 12.9 3.7 11.1 7.5 10.2 10.9 11.0 12.2 13.0 11.6 17.2 17.4

Advanced economies -0.8 9.5 17.3 1.9 17.4 12.1 10.7 1.2 10.3 6.5 9.9 10.7 10.9 11.7 12.8 11.4 17.8 12.7

Emerging market and developing economies -6.5 11.5 17.3 6.9 6.0 21.2 16.9 8.5 12.7 9.5 10.8 11.2 11.1 13.1 13.2 11.8 16.1 26.8

Commodity-exporting EMDEs -8.9 17.1 34.2 -9.0 17.8 24.4 23.0 12.9 19.3 9.9 17.2 16.7 16.3 20.4 13.9 13.1 20.9 15.3

Other EMDEs -4.6 9.3 10.9 14.2 1.6 19.9 14.6 6.8 10.2 9.3 8.5 9.0 9.1 10.3 12.9 11.3 14.5 31.5

East Asia and Pacific -6.1 9.7 11.2 15.9 0.8 17.8 15.3 8.7 11.1 9.0 10.4 8.0 9.8 10.0 12.8 10.9 14.4 33.7

Europe and Central Asia -6.0 16.4 32.8 -1.6 16.2 32.6 21.2 5.4 19.8 11.1 11.3 20.3 16.5 22.2 19.5 15.9 26.4 20.9

Latin America and Caribbean -2.3 11.9 22.6 -0.2 7.0 16.2 17.4 9.7 11.6 12.8 10.7 11.4 10.5 15.9 9.3 8.4 12.0 11.9

Middle East and North Africa - - - - - - - - - - - - - - - - - -

South Asia 0.6 5.5 11.5 -7.9 8.7 27.3 10.9 6.3 -1.8 -3.4 11.7 9.8 4.6 4.1 12.1 11.4 6.5 8.3

Sub-Saharan Africa -13.6 14.5 44.9 -12.4 10.0 27.7 18.0 4.6 10.7 11.7 13.5 16.2 8.4 16.4 13.9 16.4 - -

Imports, nominal, US$, sa

World -5.3 12.1 22.2 15.4 -0.1 32.1 10.3 -6.2 25.5 7.2 21.5 16.0 5.9 17.9 13.1 19.6 16.5 21.3

Advanced economies -3.4 9.1 18.9 4.2 13.5 19.5 9.1 2.1 10.2 5.1 10.6 8.9 9.3 14.0 13.8 13.8 18.7 15.2

Emerging market and developing economies -6.4 13.8 24.2 22.0 -6.9 39.5 11.0 -10.3 34.5 8.4 27.8 20.4 3.9 20.2 12.7 22.9 15.2 24.7

Commodity-exporting EMDEs -7.3 13.2 20.1 30.7 -11.7 45.6 8.8 -15.4 39.5 7.2 31.5 22.4 -0.3 21.2 11.3 26.0 10.2 -

Other EMDEs -3.0 16.1 38.6 -3.4 11.6 20.7 19.0 11.0 17.2 12.5 15.7 14.3 17.6 16.6 17.8 13.4 32.8 11.4

East Asia and Pacific -3.6 17.4 49.5 -11.5 13.2 17.8 20.6 12.4 17.6 13.4 15.8 13.9 19.0 17.8 18.6 9.7 37.7 9.2

Europe and Central Asia -1.2 18.3 38.4 14.4 20.0 17.7 14.8 8.1 23.0 13.7 26.8 17.0 20.0 21.1 23.5 22.2 28.6 21.6

Latin America and Caribbean -7.4 8.2 23.5 -7.4 9.9 18.9 13.1 -1.3 12.1 6.2 7.6 9.3 4.7 16.3 9.0 6.9 13.6 10.9

Middle East and North Africa - - - - - - - - - - - - - - - - - -

South Asia -5.4 22.3 36.4 9.9 -10.0 35.5 41.6 41.8 30.3 13.1 20.5 21.0 18.5 10.9 18.8 19.0 24.3 11.1

Sub-Saharan Africa -13.8 - - - - - - - - - - - - - - - - -

International reserves, US$1

World -2.0 7.2 1.7 2.1 1.7 1.1 0.7 0.7 0.8 0.5 0.8 0.6 0.3 0.0 0.5 0.7 1.3 -0.6

Advanced economies 3.2 9.9 3.4 2.9 1.7 1.1 1.5 1.2 1.1 0.5 0.9 0.5 0.3 -0.3 0.7 0.8 1.2 -

Emerging market and developing economies -5.2 5.3 0.5 1.5 1.7 1.2 0.2 0.4 0.7 0.4 0.7 0.6 0.4 0.2 0.4 0.6 1.3 -0.5

Commodity-exporting EMDEs -4.5 - 0.5 0.5 0.8 - 0.1 0.1 0.2 0.2 0.3 0.2 0.1 0.5 - - - -

Other EMDEs -5.7 5.9 0.5 2.0 2.2 1.1 0.2 0.5 0.9 0.6 0.9 0.8 0.5 0.1 0.4 0.7 1.4 -0.7

East Asia and Pacific -7.3 5.3 0.5 1.7 2.1 1.1 0.1 0.8 0.8 0.1 1.0 0.6 0.5 0.0 0.4 0.7 1.0 -0.9

Europe and Central Asia 3.4 10.2 2.9 3.2 3.1 0.9 0.3 -0.2 1.3 2.0 1.1 1.6 0.3 0.2 1.0 -0.3 3.6 0.2

Latin America and Caribbean 1.4 2.7 0.5 1.7 1.0 -1.0 -0.3 0.8 0.2 0.8 0.6 0.3 -0.1 0.5 -0.4 -0.7 0.8 0.1

Middle East and North Africa -10.7 - -2.0 -1.7 - - 0.2 -1.2 -0.2 -0.3 -1.0 -0.2 - - - - - -

South Asia 3.6 11.8 2.1 4.5 2.5 2.2 1.0 0.7 2.0 1.7 1.1 1.3 0.1 -0.1 0.2 2.1 2.4 -0.2

Sub-Saharan Africa -4.7 - 3.2 0.7 0.4 - -0.5 3.5 -1.2 -1.6 2.4 -1.7 0.0 0.8 - - - -

2017

(Percent change y/y, except quarterly trade data, which are percent change q/q, annualized, and international reserves data, which are percent change over the previous period)

10

April 2018

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TABLE D: Financial Markets (Percent change y/y, except quarterly trade data, which are percent change q/q, annualized, and international reserves data, which are percent change over the previous period)

TABLE E: Commodity Prices

2017 2018 2018 MRV 1

2016 2017 Q2 Q3 Q4 Q1 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Interest rates and LIBOR (percent)

U.S. federal funds effective 0.39 0.97 0.92 1.13 1.17 1.40 0.88 0.88 1.01 1.13 1.13 1.13 1.13 1.13 1.27 1.38 1.38 1.45 1.63

ECB repo 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

US$ LIBOR 3-months 0.74 1.26 1.20 1.32 1.47 1.93 1.16 1.19 1.26 1.31 1.31 1.32 1.36 1.43 1.61 1.73 1.87 2.18 2.36

EURIBOR 3-months -0.26 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33 -0.33

U.S. 10-year Treasury yield 1.84 2.33 2.26 2.24 2.37 2.76 2.30 2.30 2.19 2.32 2.21 2.20 2.36 2.35 2.41 2.58 2.86 2.84 3.00

German Bund, 10 year 0.11 0.37 0.31 0.46 0.38 0.57 0.26 0.37 0.29 0.54 0.42 0.41 0.43 0.37 0.36 0.50 0.67 0.54 0.54

Spreads (basis points)

JP Morgan emerging markets 410 325 325 322 313 309 331 320 325 327 325 314 306 320 312 299 309 319 322

Asia 221 164 169 161 151 157 173 167 166 163 163 157 148 153 151 146 156 168 170

Europe 302 243 242 234 233 221 250 237 240 243 234 224 226 244 229 212 217 234 241

Latin America and the Caribbean 537 429 427 428 416 418 431 420 430 435 435 416 407 422 419 410 420 423 423

Middle East 517 385 362 383 400 367 350 353 382 382 382 384 381 421 398 359 366 374 391

Africa 518 376 386 380 350 320 400 376 383 394 378 367 360 359 332 305 317 337 340

Stock indexes (end of period)

Global (MSCI) 424 508 465 487 508 500 455 464 465 478 478 487 497 505 508 502 517 500 508

Advanced economies ($ index) 1761 2086 1916 2001 2086 2042 1878 1912 1916 1961 1960 2001 2037 2077 2086 2053 2113 2042 2082

United States (S&P 500) 2258 2668 2423 2519 2668 2590 2384 2421 2423 2470 2472 2519 2575 2648 2668 2631 2711 2590 2635

Europe (S&P Euro 350) 1475 1558 1534 1571 1558 1493 1564 1576 1534 1526 1512 1571 1600 1563 1558 1518 1522 1493 1546

Japan (Nikkei 225) 19302 22530 20033 20356 22530 21203 19197 19836 20033 19974 19720 20356 22198 22730 22530 21650 21794 21203 22278

Emerging market and

developing economies (MSCI) 861 1139 1011 1082 1139 1167 978 1005 1011 1066 1088 1082 1119 1121 1139 1158 1202 1167 1154

EM Asia 419 577 512 543 577 589 484 505 512 538 544 543 571 572 577 584 603 589 584

EM Europe 295 341 304 331 341 350 313 308 304 315 336 331 330 330 341 354 370 350 337

EM Europe and Middle East 248 275 251 268 275 280 259 255 251 261 274 268 268 265 275 285 295 280 272

EM Latin America & Caribbean 2341 2811 2544 2917 2811 3008 2601 2532 2544 2752 2873 2917 2809 2719 2811 2945 3095 3008 2979

Exchange rates (LCU / USD)

Advanced economies

Euro Area 0.90 0.89 0.91 0.85 0.85 0.81 0.93 0.91 0.89 0.87 0.85 0.84 0.85 0.85 0.84 0.82 0.81 0.81 0.81

Japan 108.80 112.11 111.10 110.96 112.75 107.94 110.02 112.36 110.91 112.31 109.78 110.80 112.93 112.81 112.51 109.83 107.96 106.02 107.66

Emerging market and developing economies

Brazil 3.49 3.19 3.21 3.16 3.24 3.24 3.14 3.20 3.30 3.20 3.15 3.13 3.19 3.26 3.28 3.19 3.25 3.28 3.41

China 6.65 6.76 6.86 6.67 6.61 6.35 6.89 6.88 6.81 6.77 6.67 6.57 6.62 6.62 6.59 6.41 6.32 6.32 6.30

Egypt 10.12 17.85 18.10 17.77 17.71 17.68 18.09 18.10 18.11 17.92 17.75 17.65 17.64 17.68 17.81 17.74 17.67 17.63 17.62

India 67.19 65.11 64.48 64.29 64.71 64.40 64.52 64.46 64.45 64.44 63.97 64.46 65.07 64.85 64.20 63.72 64.44 65.06 66.11

Russia 67.06 58.31 57.17 58.93 58.47 56.96 56.53 56.88 58.10 59.72 59.42 57.66 57.76 58.97 58.70 56.93 56.81 57.15 61.38

South Africa 14.71 13.31 13.21 13.19 13.62 11.93 13.46 13.25 12.91 13.15 13.25 13.17 13.71 14.06 13.11 12.15 11.82 11.84 12.11

Memo: U.S. nominal effective rate

(index) 119.7 119.6 120.7 116.6 117.5 114.1 121.7 121.0 119.4 117.9 116.5 115.5 117.5 117.7 117.4 114.7 113.7 113.9 114.9

Sources: Bloomberg, J.P. Morgan, and World Bank.

1 MRV = most recent value.

2017

2017 2018 2018 MRV 1

2016 2017 Q2 Q3 Q4 Q1 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Energy 2

55 68 64 65 75 82 67 64 60 62 65 68 71 76 78 85 81 81 81

Non-energy 2

80 84 82 84 85 88 82 83 82 83 84 85 85 85 85 87 89 88 88

Agriculture 2

88 87 87 86 86 89 87 88 87 88 85 86 86 86 85 88 89 91 91

Metals and minerals 2

64 79 74 81 84 88 75 73 72 76 83 84 84 84 85 89 89 85 87

Memo items:

Crude oil, average ($/bbl) 43 53 50 50 59 64 52 50 46 48 50 53 55 60 61 66 63 64 71

Gold ($/toz) 1249 1258 1258 1278 1275 1329 1267 1246 1260 1237 1283 1314 1280 1282 1264 1331 1331 1325 1325

Baltic Dry Index 676 1152 1023 1138 1509 1171 1229 979 861 906 1144 1363 1484 1455 1589 1234 1130 1149 1306

Sources: World Bank, World Bank Commodities Price Data (The Pink Sheet), Bloomberg. 1 MRV = most recent value.

2 Indexes, 2010 = 100.

2017