The International Monetary Fund raised its global growth forecast on Tuesday as the world economy has begun to show renewed strength. World trade was slated to grow 4.2% which was the most since 2011.
The Vanguard FTSE Emerging Markets All Cap Index (TSX:VEE) invests in stock of companies in emerging markets, including countries like China, Brazil, South Africa, and others. Shares of the index have increased 15.9% in 2017 and 10% year over year. Stocks in emerging markets are now reaching close to 3-year highs on the weaker U.S. dollar, the strength of the yuan, and the aforementioned global growth.
However, there are concerns after Turkey and the United States halted non-immigrant visas after the arrest of a U.S. consular employee. The Turkish government has been moving to expand trade with the West in recent years, but has experienced a spat of difficult relations following the attempted 2016 coup which was successfully crushed by President Erdogan.
The IMF also raised growth projections for China up to 6.8% for the year. However, the forecast for India did experience a marginal decline. The IMF did warn of a possible slowdown in China due to high debt levels. Since 2008 its debt as a percentage of GDP has increased by 10% annually.
In any case, this ETF offers solid short and medium term growth for investors concerned that North American or European indexes could face a cooldown with monetary policy tightening.