Washington (AFP) – The International Monetary Fund announced Tuesday that it raised its global growth forecast for 2024 to 3.1 percent, noting the “resilience” of major advanced and emerging economies around the world.
Published on: 01/30/2024 – 16:02
4 minutes
In updated data from its annual report on the global economy published on Tuesday, the International Monetary Fund indicated that it expects growth of 3.1 percent this year, compared to an increase of 2.9 percent expected in a previous report published in October, with A notable reassessment of the United States, China, India, Russia and Mexico.
“At the same time there was lower inflation and greater growth,” International Monetary Fund chief economist Pierre-Olivier Gorinchas told reporters before the report was published.
He added, “This did not happen only in the United States. The economies of many countries showed great resilience last year and this will continue in 2024,” citing as examples China, Russia, Brazil, and India.
However, despite raising growth expectations, global growth is expected to remain below its recent historical average of 3.8% this year and next due to the continuing effects of raising interest rates, the cancellation of government support related to the Covid-19 pandemic, and the continuing decline in productivity levels.
Among the G7 advanced economies, growth in European countries appears to remain weak, reflecting ongoing challenges, while the performance of Japan and Canada is expected to improve slightly.
The International Monetary Fund’s inflation forecast remained unchanged at 5.8% for the year 2024, but this hides a large disparity between rich and poor countries.
The new data expected the inflation rate in advanced economies to reach 2.6% in 2024, a decrease of 0.4 percentage points from October, while the annual inflation rate in emerging and developing economies is expected to reach 8.1%, an increase of 0.3 percentage points. .
This increase can be attributed in large part to ongoing problems in Argentina, where consumer price increases exceeded 200% last year amid a deep economic crisis.
“Grow bigger”
The economies of both the United States and China grew at a higher rate than expected by the International Monetary Fund, which had reported a significant slowdown for both.
The International Monetary Fund now expects the US economy to grow 2.1% in 2024, a slight decline from the 2.5% that was expected in 2023.
The International Monetary Fund considered this improvement “due to the growth achieved in 2023, which was larger than what the Fund expected.”
Meanwhile, the Chinese economy grew by 4.6% this year, down from 5.2% last year.
As for India, the International Monetary Fund expects it to achieve growth of 6.5% this year, an increase of 0.2 percentage points from October, after a growth rate of about 6.7% in 2023.
The International Monetary Fund also raised the growth prospects for Russia, Iran and Brazil for next year.
Existing challenges in Europe
While many Asian economies are seeing continued improvement, Europe continues to weigh on the global outlook, with the International Monetary Fund highlighting “remarkably weak growth in the euro area.”
Germany’s economy is expected to once again record the slowest growth in the G7, with an increase of only 0.5% this year after contracting by 0.3% in 2023.
Britain, France and Italy are also expected to grow by 1% or less this year, while the Spanish economy is expected to perform slightly better, with growth of 1.5%.
The International Monetary Fund explained in the report that weak growth in the euro area reflects “weak consumer confidence and the continuing impact of high energy prices.”
However, it seems that the general picture in 2024 will be less bleak than expected for many countries, as all countries mentioned in the report, with the exception of Argentina, are expected to achieve positive growth this year.
This is an improvement compared to 2023, when estimates expected contraction in four of the 30 economies mentioned in the report, according to the International Monetary Fund.
© 2024 AFP
2024-01-30 15:02:06
#International #Monetary #Fund #raises #global #growth #forecasts
