Global Economic Outlook: Promising Growth Despite Headwinds
May 2024
Recovery
Recovery
We are now forecasting 2.5% global real GDP growth in 2024 (compared with 2.4% previously), meaning growth will be unchanged rather than slowing from 2023. Growth is proving surprisingly resilient in the face of high interest rates and geopolitical risks.
The change in global growth reflects another upward revision for US growth in 2024 to 2.2% (from 2% previously), upward revisions for several European economies that have pushed euro area growth to 1% (from 0.8%) and an upward revision for Brazil to 2.1% (from 1.8%).
We have reduced our expectations for future monetary policy loosening, removing one 25-basis-point cut from the loosening cycles of both the Federal Reserve (the US central bank) and the European Central Bank in 2024-25. In contrast, we now expect the Bank of England (the UK central bank) to cut quicker than previously forecast, lowering its rate to 3.5% by end-2025 (compared with 4.25% previously).
The US dollar effective exchange rate is now forecast to appreciate for a third consecutive year in 2024—we previously expected a mild depreciation. This reflects a stronger depreciation in the yen’s value than previously forecast and the fact that we are no longer forecasting euro appreciation.
Contents:
Continue reading...
Get access to 100s of case studies, workshop templates, industry leading events and more.
Global Economic Outlook: Promising Growth Despite Headwinds
May 2024
Recovery
Recovery
We are now forecasting 2.5% global real GDP growth in 2024 (compared with 2.4% previously), meaning growth will be unchanged rather than slowing from 2023. Growth is proving surprisingly resilient in the face of high interest rates and geopolitical risks.
The change in global growth reflects another upward revision for US growth in 2024 to 2.2% (from 2% previously), upward revisions for several European economies that have pushed euro area growth to 1% (from 0.8%) and an upward revision for Brazil to 2.1% (from 1.8%).
We have reduced our expectations for future monetary policy loosening, removing one 25-basis-point cut from the loosening cycles of both the Federal Reserve (the US central bank) and the European Central Bank in 2024-25. In contrast, we now expect the Bank of England (the UK central bank) to cut quicker than previously forecast, lowering its rate to 3.5% by end-2025 (compared with 4.25% previously).
The US dollar effective exchange rate is now forecast to appreciate for a third consecutive year in 2024—we previously expected a mild depreciation. This reflects a stronger depreciation in the yen’s value than previously forecast and the fact that we are no longer forecasting euro appreciation.
.webp)