The International Monetary Fund (IMF) has projected a decrease in global growth to 3.0% in 2023, further declining to 2.9% in 2024, according to its “Navigating Global Divergences” report. This anticipated slowdown is attributed to multiple shocks including rising living costs, geo-economic fragmentation, the withdrawal of fiscal support, and cyclical factors.
Advanced economies are expected to experience a decline in growth from 2.6% to 1.5% in 2023 and further to 1.4% in 2024 due to policies aimed at curbing inflation. Meanwhile, developing economies are predicted to face a slight decrease from 4.1% in 2022 to 4.0% in the subsequent years, with disparities widening between regions.
Global inflation is set to decline from 8.7% in 2022 to 6.9% in 2023 and then further to 5.8% in 2024. This decline is attributed to tighter monetary policies and falling commodity prices, although core inflation pressures are expected to decrease at a slower pace.
The report also raises concerns about potential disruptions such as China’s property sector crisis, the Ukraine conflict, extreme weather events, the transition to green energy, and potential spikes in food and energy prices due to climate and geopolitical shocks.
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