Citi trims global growth outlook for 2016, more ECB stimulus seen

The world economy may be on the cusp of a 'tipping-point' as central bank stimulus will be less forthcoming and possibly less effective in those geographies were it is still applied.

In recent years, substantial monetary easing had offset repeated disappointments in global growth.

William Buiter, chief economist at Citi told clients on Thursday that: "the global outlook is at a critical point of vulnerability".

As a result Buiter trimmed his forecast for the rate of growth in the world's gross domestic product from 2.8% to 2.7%.

The above implies "continued deflationary pressures," he said.

"Risks to our growth forecasts probably remain to the downside, with increasing risks of global recession. The Fed remains likely to hike rates further, while the BoJ and BoE are on hold for now," he said.

The ECB would ease again, he expected, but only modestly rather than a "big bazooka," Buiter added.