Hong Kong pulls out of recession
In a sign that the worldwide economy may well be improving, the Hong Kong authorities today released figures which show the economy grew by 3.3% in the second quarter of 2009. This is a great improvement on the first quarter of 2009 at around three times the growth expected by analysts and has shocked many in the Hong Kong financial markets. The fact that the Far East markets look like they may have turned is very positive for the worldwide economy although countries such as the UK do not appear to be moving at the same pace.
The Hong Kong authorities have also upgraded their forecasts for 2009 and now believe that the economy will fall by between 3.5% and 4.5% against its previous forecast of between 5.5% and 6.5%. This is a major turnaround in a very short space of time and could ignite the confidence factor which is so vital to the long-term recovery of the worldwide economy. If this improvement in economic performance was replicated in China and Japan for example this would then have a positive impact on the US economy and US investment markets.
Slowly but surely the building blocks of future growth in the worldwide economy are starting to materialise and even though the likes of the UK have been slow to respond they will in due course be dragged along by any future recovery in the overall worldwide economy.
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