ICC survey predicts ?moderate? global economic upturn

ICC survey predicts æmoderateÆ global economic upturn    A weakening in the world economy in 2004 'has now been supplanted by a moderate cyclical upturn' in the fourth quarter, according to a survey of corporate economists sponsored by the International Chamber of Commerce and conducted by the Ifo Institute for Economic Research in Munich, Germany.
   The fourth-quarter improvement 'applied only to assessments of the current situation' by 1,100 economists participating in the survey, the ICC said in a statement. Expectations for the coming six months actually weakened slightly.
   For the present, however, 'improvement was especially marked in Europe, where assessments of the current situation and expectations for the next six months were both stronger. The economic climate indicator also rose in Asia, although more confident assessments' for that region 'were offset by more cautious expectations for the immediate future,' the ICC explained.
   Only in North America did the climate indicator decline as a result of 'clearly worsening expectations,' the survey reported.
   Unlike appraisals for the three previous quarters of 2005, the latest survey showed that a clear rise in inflation is expected in the near future. Inflation expectations had stood at 2.9 percent, the same rate for 2004, but are now pegged at 3.3 percent, due to 'sharp price increases for oil and other raw materials that are now expected to have a stronger effect on consumer prices,' the ICC said.
   A growing number of economists predicted an increase in central bank interest rates in North America, Asia and also in western Europe.
   The fourth-quarter report concluded that the U.S. dollar is regarded 'as adequately valued in all of the surveyed countries, after having been undervalued for two years.'    The euro and the British pound were less frequently regarded as overvalued than in previous surveys.
   However, for the first time since the beginning of 2004, the Japanese yen was appraised as slightly undervalued.
   The ICC represents thousands of businesses in more than 130 countries. The Ifo Institute, which has conducted quarterly surveys of business cycle developments since 1981, receives financial support from the ICC in Paris and from the European Commission in Brussels.