Acc to IMF economists Global growth prospects remain anemic, and global recession risk high.
As of November 17, 2023, the world economy is projected to grow by 2.3% in 2023 and 2.5% in 2024, according to the United Nations1. This is a slight uptick in the global growth forecast for 2023.
The International Monetary Fund (IMF) has also released its outlook for the global economy. The baseline forecast is for global growth to slow from 3.5 percent in 2022 to 3.0 percent in 2023 and 2.9 percent in 2024, well below the historical (2000–19) average of 3.8 percent. Advanced economies are expected to slow from 2.6 percent in 2022 to 1.5 percent in 2023 and 1.4 percent in 2024 as policy tightening starts to bite.
It is important to note that the outlook for the global economy is gloomy, according to the results of the latest survey of chief economists. Global growth prospects remain anaemic, and global recession risk high.
According to Deloitte Insights, the US economy is expected to experience a “soft landing” in Q3 2023, with a projected growth rate of 2.4% 1. The Conference Board also forecasts a growth rate of 2.4% for the US economy in 2023, which is expected to fall to 0.8% in 2024 2. The Congressional Budget Office (CBO) projects that real gross domestic product (GDP) will increase by 0.9% in 2023 and 1.8% in 2024 3. The Federal Reserve expects the US economy to maintain its growth pace in the second half of 2023, forecasting full-year GDP growth of 2.1% .
When are interest rates expected to be cut?
According to a recent survey by Bankrate, the majority of economists believe that the Federal Reserve could begin cutting interest rates in 2024. Only a small percentage of economists expect the Fed to cut rates in 2025 or later. No expert projects that the Fed will cut rates this year
UBS Investment Bank has estimated that the Federal Reserve is likely to make significant cuts to interest rates next year beginning as early as March. Slowing inflation could enable the Fed to make these cuts.
Morgan Stanley and UBS strategists anticipate that the benchmark federal funds rate will drop to a range between 2.5% and 2.75% by the end of 2024, with a terminal rate of 1.25% projected by early 2025. Their outlook is anchored in the belief that the US economy will slip into recession by the second quarter of 2024.
