The International Monetary Fund (IMF) offers most recent forecast update for the global economy in its July report on World Economic Outlook Update – The Global Economy in a Sticky Spot. Over the next two years it expects:
- Global GDP growth forecast broadly unchanged: World GDP growth will fall from 3.3% to 3.2% in 2024 before recover back to 3.3% in 2025. This is slightly better than its April forecast of 3.2% for 2025 but remains below long-term trends.
- OECD economies the laggards: The fall in global forecasts is largely driven by advanced economies, whose growth rate will not improve until 2025. Euro area growth will be an especially anaemic 0.9% in 2024, in large part due to the impact of ongoing geopolitical tensions.
- Inflation starts to fall but persists in 2024 Global headline inflation is expected to drop from 6.7% in 2023 to 5.9% in 2024 and 4.4% in 2025. Advanced economies will not see inflation decline to normal levels until the latter part of 2024. Emerging markets are expected to face stickier inflation compared to the rest. This will put pressure on central banks to maintain tight monetary policy, which will be a further drag on growth.
- Although tight monetary policy will reduce some inflation, upward revision for international commodity prices is seen as the threat for disinflation. This includes a rise in oil prices by 3.3% in 2024 reflecting the present price pressure from the Middle East conflict.
- Global growth forecast broadly unchanged while the risks are persistent. Sticky service inflation, escalated trade tensions and increased policy uncertainty could raise the prospect of higher for even longer interest rates.
Read the IMF’s World Economic Outlook Update for July 2024 here.
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|
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2023 actual
|
2024 forecast
|
2025 forecast
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|
Real GDP growth, %
|
World |
3.3 |
3.2 |
3.3 |
|
|
Advanced economies |
1.7 |
1.7 |
1.8 |
|
|
Emerging Market and Developing Economies |
4.4 |
4.3 |
4.3 |
|
|
Australia |
2.0 |
1.4 |
2.0 |
|
|
United States |
2.5 |
2.6 |
1.9 |
| |
Euro Area |
0.5 |
0.9 |
1.5 |
|
|
China |
5.2 |
5.0 |
4.5 |
|
|
|
|
|
|
|
Commodity prices, %
|
Oil |
-16.4 |
0.8 |
-6.0 |
| |
Nonfuel |
-5.7 |
5.0 |
1.6 |
| |
|
|
|
|
| Consumer Prices, % |
World |
6.7 |
5.9 |
4.4 |
| |
Advanced Economies |
4.6 |
2.7 |
2.1 |
| |
Emerging Market and Developing Economies |
8.3 |
8.2 |
6.0 |
