World Growth to Slow in 2025 Despite Monetary Easing – Fitch
(25 June 2024 – Global) Fitch Ratings has scaled up its world growth forecasts for 2024 as confidence in European recovery prospects improve, China’s export sector recuperates and domestic demand in emerging markets excluding China displays positive signs.
In Fitch Rating’s latest Global Economic Outlook, the group forecasts world growth to decelerate to 2.4 percent as US growth slows to a below-trend rate of 1.5 percent and growth in the EU to improve to 1.5 percent. Domestic demand has weakened in China as the property market collapse worsens and stagnant private consumption growth. Fiscal policy is being loosened and exports have rebounded, supporting real GDP in the face of deflationary pressures remaining embedded.
“Central banks remain cautious about loosening policy too rapidly, particularly in light of high services inflation. Pressures from rising labour costs and housing rents and the normalisation of relative price trends are keeping services inflation elevated” commented Fitch Ratings Chief Economist, Brian Coulton.
“We have raised our forecast for world growth in 2024 to 2.6 percent from 2.4 percent in the March 2024 Global Economic Outlook. We have revised up Eurozone growth by 0.2 percentage points (pp) to 0.8 percent; China’s growth to 4.8 percent from 4.5 percent; and EM excluding China growth quite sharply, by 0.5pp to 3.7 percent.”
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