Strong US economy drives
global growth upgrade. We have raised our global real GDP growth forecast for 2024 from 2.3% to 2.4%. This means that
growth in 2024 will be basically unchanged from an estimated 2.5% in 2023. Although growth
remains sedate by historical standards, this stability demonstrates resilience in the global economy,
given high interest rates and geopolitical tensions.
• The change in global growth follows a further upgrade to our US GDP growth forecast, which now
stands at 1.8% (up from 1.3% previously), with the latest US data pointing to continued resilience. The
US upgrade has more than offset a downgrade in China’s growth forecast from 4.9% to 4.7%. China’s
downgrade reflects a dimmer outlook for consumption and for property-related activity, owing to
delays in support for distressed developers.
• Our global monetary policy forecasts are largely unchanged from the previous month, but we
have brought forward to the second quarter of this year the date at which the Bank of Japan (BOJ,
the central bank) will exit its negative interest-rate policy. The BOJ is then expected to move to a
positive, albeit only slightly, rate in early 2025. Although these are incremental changes, they will still
be sufficient to encourage a reshoring of Japanese capital that will tighten borrowing conditions in
other markets.
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