Global Economy Mixes, IMF Adjusts Economic Growth Forecasts
The International Monetary Fund recently released a report, adjusting its economic growth forecasts for many countries. Among them, expectations for the United States, Brazil and the United Kingdom were raised, while those for China, Japan and the eurozone were lowered.
The International Monetary Fund (IMF) recently released a report adjusting economic growth forecasts for many countries.Among them, the United States, Brazil and the United Kingdom have raised their growth forecasts for 2024, while forecasts for China, Japan and the Eurozone have been lowered.
Despite this, the IMF remains unchanged at 3.2% global growth outlook for 2024.The report warns that potential risks such as geopolitical conflicts and trade wars remain, and highlights the continuing challenges posed by tightening monetary policy.
US growth forecast raised
The IMF has raised its U.S. growth forecast for 2024 to 2.8%, driven mainly by strong consumer demand, rising wages and asset prices.The U.S. growth forecast for 2025 has also been raised to 2.2%, indicating that the economy is slowly returning to its pre-epidemic growth trend.The report pointed out that this resilience lies in the achievement of a "soft landing", in which inflation cools without causing significant unemployment.However, markets remain concerned that excessively tight monetary policy may curb future growth.
Forecasts for other major economies are mixed
Brazil's growth forecast has been significantly raised, with its 2024 growth forecast rising by 0.9 percentage points to 3.0%, thanks to strong private consumption and investment.Instead, Mexico's growth outlook was revised downwards to 1.5%, as tight monetary policy curbed economic growth.
China's growth forecast for 2024 was lowered by 0.2 percentage points to 4.8%.Although exports have supported economic activity, China's real estate market is weak and consumer confidence is sluggish.Japan's forecast has also been lowered, with a growth forecast of only 0.3% in 2024, reflecting continued supply chain disruptions.
Germany's economic outlook remains cloudy, with zero growth expected in 2023 and continued weakness in the manufacturing industry dragging down overall economic performance.This has lowered eurozone growth expectations to 0.8% in 2024.In contrast, Spain's growth forecast was raised to 2.9%, while the UK's forecast was raised to 1.1%, benefiting from lower inflation and interest rates that stimulate consumer demand.
India performs well amid global economic slowdown
Against the backdrop of the global economic downturn, India's growth performance is particularly prominent. The IMF maintains its growth forecasts of 7.0% in 2024 and 6.5% in 2025, continuing to maintain the highest growth rate among major economies, demonstrating its resilience in a downturn environment.
Geopolitical and trade risks increase
The IMF warned that the global economy faces significant risks, including potential trade wars and escalating conflicts in regions such as the Middle East and Ukraine.If trade tensions intensify, such as tariff increases among major economies, the IMF predicts that global GDP could fall by 0.8% in 2025 and 1.3% in 2026.Rising commodity prices, especially oil prices, pose an additional threat to the fragile economic recovery.
Call for domestic reform and innovation
Faced with growing protectionist trends, the IMF urges countries to focus on domestic reforms rather than industrial policies that protect specific industries.The IMF emphasizes the need to promote reforms that enhance technology, competition and private investment to achieve sustainable economic growth.
market outlook
Despite the strong performance of the United States and India, overall global economic growth remains weak.Against the backdrop of geopolitical tensions and tightening monetary policy, the market outlook should remain cautious, especially in areas such as Europe and China that may pose downside risks.
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