After a 3.3% contraction in 2020 and a 5.8% rebound in 2021, global GDP growth is expected to slow to 2.7% in 2022 and 2.6% in 2023, the global service provider said. financials S&P Global Market Intelligence. This forecast is attributable to the weaker performance of the US economy in the first half of the year, while the downward revision to 2023 reflects the widespread effects of tighter financial conditions.
“With a global population growing at around 1.0% a year, our outlook calls for solid gains in real GDP per capita and thus avoiding a global recession,” said Sara Johnson, executive director, Economic Research, S&P Global Market Intelligence. The risk of recession remains high, around 40 to 50% in the major economies.
Global GDP likely shrank in the second quarter of 2022, but this expected outcome is not inevitably the start of a global recession. “A period of below-average global growth is the most likely outcome. Absent further shocks, the global economy is expected to resume growth, albeit at a tepid annual pace of less than 2.0% per year. quarter in the third and fourth quarters of 2022,” Johnson said.
Mainland China is reopening after lockdowns and emerging Asia-Pacific markets are seeing solid growth even as European and US economies struggle. “Around the world, the transition from pandemic to endemic for COVID-19 is enabling growth in travel, tourism and other consumer services sectors that were hit hard during the 2020 recession. In countries advanced, household finances are generally in good shape, driven by accumulating savings and appreciating assets in 2020-21 In a cycle dominated by consumer spending, households are well positioned to drive the economy forward ‘global expansion,’ Johnson added.
In response to persistently high inflation and inflationary expectations, several central banks accelerated monetary policy tightening measures. In addition, investors turning to safe havens would likely mean continued US dollar strength and heightened risks for emerging markets that rely on capital inflows to fund their trade and fiscal deficits.
Consistent with evidence of declining finished goods prices and their pervasiveness in the last quarter of 2022, global inflation is expected to decline from 7.3% in 2022 to 4.2% in 2023 and 2.7% in 2024, a he declared. Resilient growth in the Asia-Pacific region is key to prospects for sustained global economic growth in 2022 and 2023. This region is likely to account for 53% of global real GDP growth in 2022 and an exceptional 62% in 2023.
India, Indonesia, Vietnam and the Philippines are likely to achieve growth rates of 5-7%. “This performance reflects strong intra-regional growth dynamics linked to regional free trade agreements, efficient supply chains, competitive costs and steady inflows of foreign direct investment. The region is also benefiting from strong pent-up demand for semiconductors and automobiles. across the region experienced subsequent waves of Covid-19 and are now experiencing robust recoveries following the easing of pandemic restrictions,” he added. (ANI)
(This story has not been edited by the Devdiscourse team and is auto-generated from a syndicated feed.)