Interest rates in several countries have continued to decline to historically low levels. With the receding global risks, financing conditions for the emerging markets have eased considerably and spreads for many countries have declined significantly. Despite these favourable developments, the world economic outlook continues to be fragile and weighed down by downside risks. Labour market conditions continue to be soft.
Data on industrial production and trade growth indicate marked slowdown. Rise in oil prices in the recent weeks is also worrisome. Investment activity in major industrial countries is yet to show a decisive turnaround, although it is heartening to note that signs of pick-up in growth in the US are discernible, of late.