Brighter later

By R.L.W., P.K. and A.M.

World GDP forecasts for 2013 and 2014

THE world economy will grow by 2.9% this year and 3.6% in 2014, according to the latest estimates from the IMF. Economic growth was revised down from July estimates (by 0.3 and 0.2 percentage points, respectively) thanks to a weaker outlook for emerging markets, lately the world's main growth engine. China's slowdown represents the biggest headwind, especially for exporters of commodities. The pace of growth in advanced economies should continue to increase. America will grow by 2.6% next year. Its economy has been buoyed by rising household wealth and house prices, and by an easing of bank-lending conditions. The stimulative policies (known as "Abenomics") of Japan's prime minister, Shinzo Abe, may boost its GDP by 1%, though wage growth remains sluggish. Even the euro area is enjoying higher business confidence. But projections for growth hinge on several assumptions, and the IMF warns of nasty spillovers from policies in some of the world’s biggest economies: like a dangerous government fiscal impasse in America, incomplete reform in Japan, and stagnation and high unemployment across the euro area. Emerging markets, many of which have already seen destabilising capital outflows and sinking asset prices, may struggle to weather the storm.