Economic Views, BRICs February 2012

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Our latest paper in our Economic Views series looks at the challenges and opportunities in the BRIC (Brazil, Russia, India and China) economies.

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We expect the BRIC countries to continue to drive world economic growth throughout 2012 and they are all expected to grow faster than any of the developed economies this year.

The end 2011 saw a slowing of growth but these economies have scope for fiscal and monetary stimulus measures should they need to support a slowdown in private sector growth.

Key opportunities:

  • Easing of inflationary pressures and interest rate cuts
  • Government reforms to support the domestic economy
  • Stable longterm foreign capital inflows to continue

Key threats:

  • Moderation in economic growth compared to 2010 on account of domestic and external factors
  • Equity outflows and vulnerable exchange rates
  • Political uncertainty with upcoming elections in Russia

We remain confident that these economies will continue to drive world economic growth in 2012.