DNA Money Edit: Global economy likely to slow down in 2019

On any given day, the government's intention to move towards a single Goods and Services Taxes rate coupled with the removal of the highest slab would have brought cheers to the market. Instead, Indian stocks ended at a two-week low on Monday.

It's not just India though, as most regional markets were down after the Dow Jones Industrial Average fell a sharp1.8%, while S&P 500 dropped by 2.1% on Friday.

While there are some early signs of a temporary truce between US and China over trade dispute talks which might drive US markets higher post-Christmas holidays, there is now a palpable threat of global economic growth slowing down in 2019.

While no one is saying in so many words, circumstantial evidences are pointing out such a scenario.

Take oil prices. Crude oil futures are now down by more than a third from their peaks in October to their lowest levels in 17 months, as fears of oversupply and global economic slowdown loom large.

Analysts are of the view that markets are now pricing in weaker demand outlook, as three major agencies, US Energy Information Administration, International Energy Agency and OPEC have all trimmed their oil demand growth forecasts for 2019.

That could partly be a fallout of the growing consumption of electricity in economies like India and replacement of petrol in China, where more electric vehicles are running.

That said, continuing trade wars, the disruption caused by Brexit, the Federal Reserve's latest rate hike might conspire to pull the global economy down.