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EIU Global Economic Outlook

4 Mar 2024

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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