The outlook for the global consumer packaged goods sector is positive and for global beverages it is stable, according to a report from Moody’s Investors Service. In the U.S., meanwhile, the outlook for the packaged foods sector is stable and for consumer durables it is positive.

“Further penetration into emerging markets will remain a key driver of growth for global consumer packaged goods companies over the next 12 to 18 months,” said Moody’s Vice President Kevin Cassidy. “Growth will vary by country, but will continue to exceed that in developed economies.”

Cost-cutting initiatives will improve earnings, as well as companies’ investment capacity, offset slightly by modestly higher commodity costs, Mr. Cassidy said. Moody’s expects EBIT to grow 4.5%-5.5% in the next 12 to 18 months, with revenue up more than 2%.

Moody’s stable outlook for the global beverages industry reflects slow growth in many emerging markets, even as some stabilize. Sales of beer and carbonated soft drinks will decline in some developed markets, while the trend toward craft and imported beers, as well as premium spirits and wines, will continue, though the pace of growth will slow. Moody’s expects industry EBIT to grow 4%-5% in the coming one to two years, while beverage companies also face some commodity price inflation.

Meanwhile, Moody’s stable outlook for the U.S. packaged foods sector reflects steady global economic growth. Cost-cutting will remain a key driver of profitability, with EBIT set to grow 4.0%-4.5% over the next 12 to 18 months. The pace of operating efficiency gains will slow, however, and more savings will be reinvested to reinvigorate sales. Moody’s also expects debt levels to rise on the back of rising M&A activity and share buybacks.

And Moody’s positive outlook for the U.S. consumer durables sector reflects a solid local housing market and high consumer confidence. EBIT is expected to grow 4.5%-5.5% in 2018, with cost-cutting efforts continuing to drive earnings growth. Growth in some developing markets, such as Brazil and Russia, will stabilize.