According to Reuters's survey results of 500 economists published at the end of April, global growth is forecast at 2.9% this year, faster than the 2.6% in a January poll, followed by 3.0% in 2025.
More than 90% of common contributors upgraded their views and still said there was a significant chance growth could be even stronger.
This contrasts with previous comments about the stagnation of the world economy.
Among bigger economies, the United States and India are expected to contribute the most to the pickup in growth. There has been no deterioration in the consensus view for the euro zone or No. 2 economy China either.
Before Reuters published the above information, the International Monetary Fund (IMF) said in its latest forecast in mid-April also predicted that real global GDP would grow increase by 3.2% in 2024, a slight increase compared to previous estimates. In January 2024, Global growth was projected at 3.1 percent in 2024 and 3.2 percent in 2025, with the 2024 forecast 0.2 percentage point higher than that in the October 2023 World Economic Outlook (WEO).
Despite gloomy predictions, the global economy remains remarkably resilient, with steady growth and inflation slowing almost as quickly as it rose. The journey has been eventful, starting with supply-chain disruptions in the aftermath of the pandemic, an energy and food crisis triggered by Russia’s war on Ukraine, and a considerable surge in inflation, followed by a globally synchronised monetary policy tightening.
The IMF currently predicts that major economies will reduce basic interest rates from the second half of 2024 and in the fourth quarter for the US. Regarding growth forecasts of leading regional and world economies, the IMF forecasts that US growth will increase to 2.4% in 2024 and decrease to 1.9% in 2025, due to budget spending cuts.
Meanwhile, IMF expects the Eurozone to recover from 2023's 0.4% growth, with projected rises to 0.8% in 2024 and 1.5% in 2025, if energy prices decrease, Consumption and investment continue to return thanks to a stable economy and reduced inflation.
However, analysts also point out that the future of the global economy is not yet rosy. According to IMF experts, the poorest countries have not yet escaped the crisis caused by the pandemic and rising living costs. Low-income countries are experiencing the opposite of rich countries, with growth forecasts being revised downward and average inflation higher than expected.
In some developing economies, typically China, domestic consumer demand remains weak. When domestic demand is tepid, surpluses must be sold abroad, which risks exacerbating international trade tensions in an already tense geopolitical climate. This is also the reason why the IMF forecasts that China's growth will decrease from 5.3% in 2023 to 4.6% in 2024.
In addition, the current complicated geopolitical situation in the world is leading to supply chain disruptions, pushing up oil prices, which can also derail the growth trajectory of the world economy.
Furthermore, the risk of inflation is returning. At the Spring Meetings of the World Bank (WB) and IMF recently held in the US, experts warned that the US deficit (which could reach a record 7.1% next year, 3 times the average of 2% of other developed economies) will increase inflation and can hinder the growth of the global economy.
