Moody's has revised down its forecast for GDP growth in the G20 economies to 2.8% next year, from 3.1%

  • Says that the revision mainly reflects the impact of a more marked slowdown now forecast in China and more prolonged negative effects of low commodity prices on G20 producers than earlier expected

Revised down GDP growth forecast for China in 2016 to 6.3%, from 6.5% previously

  • Cites China's slowdown in exports and investment has continued into Q3 2015
  • Signs that employment growth is weakening point to a more marked and broadly-based deceleration in the Chinese economy than previously expected
  • Ongoing policy support from the Chinese government is likely to only partly offset the underlying slowdown in the Chinese economy
  • "Slower growth in China makes a significant rebound in commodity prices in the near term unlikely. A more prolonged period of low commodity prices will lead to muted export revenues and investment for commodity-exporting G20 economies." (Marie Diron, a senior vice president at Moody's)

Expects negative GDP growth in 2016 in Brazil and Russia, extending the 2015 recessions

  • Cites recent fall in commodity prices and further depreciation of the currencies
  • These exacerbate an already unfavourable domestic economic environment in both countries

Korea and Japan will face dampened demand for their manufactured goods exports from China

  • More marked slowdown in China will likely weigh on corporates' and consumers' willingness and ability to spend, hampering domestic demand
  • Korea, forecasts GDP growth of around 2.5% in 2015 and 2016
  • Japan GDP ... forecasts growth of around 0.5% and 1% in 2015 and 2016 respectively

Slight downward revision to the US forecast in 2016, to 2.6% from 2.8% previously

  • More prolonged negative effects of the stronger dollar and lower oil prices than previously expected.

Broad-based equity price falls could have a negative impact on investor and consumer sentiment, they will not have a direct significant impact on economic activity in most countries, including in China.