KWAZULU-NATAL PROVINCIAL TREASURY

2010-02-05

MONTHLY ECONOMIC NEWS LETTER January 2010

According to the Latest World Economic Outlook of the IMF:
The Recovery Has Started, and the Challenge Is to Sustain It
Emerging and developing economies are further ahead on the road to recovery, led by a
resurgence in Asia
The pace of recovery is expected to be slow and, for quite some time, insufficient to decrease
unemployment.
Consumption and investment are gaining strength only slowly
A key constraint on the pace of recovery will be limits on credit availability
Fiscal policy is likely to become increasingly less effective in supporting demand in the absence of
reassurances to investors and taxpayers that deficits and debt will eventually be rolled back.
The key issues facing monetary policymakers are when to start tightening and how to unwind large
central bank balance sheets
Global activity is forecast to expand by about 3 percent in 2010

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