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Fitch raises global growth forecasts as China, emerging markets fuel expansion

Fitch Ratings revised upward its world GDP forecasts for 2017 and 2018, citing growth in emerging markets, particularly China.

The rating agency said global GDP would grow 3.0% in 2017 and 3.2% in 2018, up from its previous forecasts of 2.9% and 3.1% expansion, respectively, in June.

Brian Coulton, Fitch's chief economist, said data continue to suggest a synchronized global expansion across both advanced and emerging economies.

"Spill-overs from the rebound in emerging market demand are reflected in the fastest growth in world trade since 2010," Coulton said.

China's real GDP grew by an annual rate of 6.9% in the second quarter, Fitch said, and is expected to expand by 6.7% in 2017 and 6.3% in 2018, up from earlier estimates of 6.5% and 5.9%, respectively.

In the U.S., Fitch expects the Federal Reserve to raise interest rates again by the end of 2017, while business investment growth continues to rebound and economic indicators point to further gains.

The outlook is not bright for the U.K., however, as Fitch predicted a further slowdown in consumer-spending due to declining real incomes and household saving rates.

Fitch also upgraded its 2017 growth forecast for Japan to 1.3% from 1.2%, citing signs of domestic and external strength in the country's economy.