Fitch improves its forecast for global GDP growth in 2024
By Alimat Aliyeva
The international rating agency Fitch has improved its forecast for global GDP growth in 2023 to 2.9% from 2.5% expected in September, Azernews reports, citing international media outlets.
The growth estimate in 2024 has been raised to 2.1% from 1.9%.
"In 2023, the global economy showed good growth rates due to the normalization of consumption in China and accelerated economic growth in the United States, which outweighed the sharp decline in Europe after last year's energy shock in the region," the updated Global Economic Outlook (GEO) review says.
"But taking into account that all the effects of the recent tightening of monetary policy are still being felt, as well as taking into account the ongoing decline in real estate in China and the stagnation of the eurozone economy, global growth is expected to slow sharply to 2.1% in 2024."
The US GDP, according to the agency's forecast, will grow by 2.4% this year against the previously expected 2%, the eurozone - by 0.5%, not 0.6%.
China's economy will increase by 5.3% against the previous estimate of 4.8%, emerging markets excluding China - by 3.6%, not 3.4%, experts expect.
In 2024, the US economy will avoid recession and increase by 1.2%, as predicted by the agency. Previously, a rise of only 0.3% was expected.
The forecast for eurozone GDP was lowered to 0.7% from 1.1%.
Fitch analysts expect another increase in the base interest rate by the Federal Reserve in January 2024. Next, the Fed is expected to pause until July, and then cut the rate by 100 basis points by the end of next year.
The European Central Bank will begin reducing interest rates in April, by the end of 2024 it will decrease by 75 bps, the agency expects. At the same time, the Bank of Japan, on the contrary, will begin raising rates next year.
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