Fitch Raises Global Economic Growth Forecast For 2024
Date
9/11/2024 7:17:41 AM
(MENAFN- AzerNews)
Akbar Novruz
Read more
Fitch Ratings, the international credit rating agency, has
slightly revised its global economic growth forecast for 2024,
raising it from 2.6 percent to 2.7 percent.
Azernews reports that this update is included in
Fitch's September issue of the "Global Economic Forecasts
Report."
The report highlights that global economic growth is expected to
follow a historical trend, reaching 2.7 percent this year. This
figure is 0.1 percentage points higher than the June forecast,
driven by upward revisions in the economic growth projections for
the United States, Great Britain, Brazil, and Russia.
Looking ahead, global economic growth is projected to decline to
2.5 percent in 2025 and 2.4 percent in 2026. This anticipated
slowdown is largely attributed to the expected deceleration of the
U.S. economy in the coming years.
"The Fed's easy monetary policy cycle is finally about to begin,
but interest rates will remain restrictive next year, and the
impact of interest rate cuts on economic growth will be small," the
report noted.
The report also highlighted the following:
China: Economic growth in China is forecasted
to slow down next year due to a decline in export growth rates.
China's economy is expected to grow by 4.8 percent in 2024 and 4.5
percent in 2025.
Eurozone: Economic growth in the Eurozone is
anticipated to recover next year, with growth projected at 0.8
percent in 2024 and 1.5 percent in 2025.
United States: The U.S. growth forecast for
2024 has been revised upward from 2.1 percent to 2.5 percent. The
economy is projected to grow by 1.6 percent in both 2025 and 2026.
The report also emphasized that service inflation in the United
States remains high, and the Fed's monetary policy easing period
will be milder and slower than previous interest rate reduction
periods.
The report further noted that unemployment has increased in the
United States and other developed economies. However, this increase
is due to a rise in labor supply rather than a decrease in labor
demand.
"The latest data increases the Fed's confidence that inflation
is on the way down. We expect interest rate cuts of 0.25 percentage
points at the September and December meetings, followed by cuts of
1.25 percentage points in 2025 and 0.75 percentage points in 2026,"
the report stated.
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