Finally some good news for the global economy. Growth showed “astonishing resilience” during the period of disinflation between 2022 and 2023, according to the latest IMF report published this Tuesday, during the week of the general meetings of the Monetary Fund and the World Bank in Washington. “Activity has accelerated steadily” all over the world after the post-Covid recovery, despite fears of “stagnation and a global recession.” This performance, described as “unforeseen”, also occurred despite the considerable increase in interest rates by central banks in developed countries. This is due to higher than expected public spending and household consumption, thanks to savings accumulated during the pandemic.
Growth forecasts for 2024 have thus been revised upwards by 0.1% since the previous ones, published in January. That being said, global activity would stand, over five years, at 3.1%, “the lowest level recorded in around ten years.” Inflation, at the global level, is expected to increase from an annual average of 6.8% in 2023 to 5.9% in 2024 and then to 4.5% in 2025.
In detail, for advanced economies, growth is expected to increase from 1.6% in 2023 to 1.7% in 2024. The projection for this year has been revised upwards by 0.2% compared to the latest forecasts of January. This is explained by a positive correction in American growth: it would stand at 2.7% this year, or 0.6 points more than previously estimated. The IMF thus confirms Europe’s stalling compared to the United States since growth forecasts for the euro zone have been revised downwards by 0.1% compared to January. Activity would stand at 0.8% this year, then 1.5% in 2025.
Regarding France, the Washington institution expects GDP growth of only 0.7% this year, down 0.3 points compared to January. The French government remains more optimistic when it announces, in its stability program, which will be officially presented on Wednesday to the Council of Ministers, 1% while the Bank of France, more cautious, gives an estimate of 0.8%.
In 2025, the resumption of European growth, according to economists, will be driven “by stronger household consumption, as the effects of the shock on energy prices fade and a drop in inflation supports real income growth.” French growth should rebound to 1.4% next year.
If Europe still pales in comparison to the world’s leading power, it is because it suffers from low consumption, the persistent effects of energy prices due to the war in Ukraine and the decline in energy production. its German heavyweight. The eurozone’s largest economy is still struggling. Its growth rate would stand at 0.2% this year, or 0.3% less than estimated in January due to “the persistent weakness of consumer morale”. This adjustment is offset by the good performance of smaller economies, notably Belgium and Portugal.
As expected, economists remain pessimistic about Chinese growth. Activity is expected to continue to slow down, going from 5.2% in 2023 to 4.6% in 2025 due to weakness in the real estate sector. On the Indian side, activity would remain strong, at 6.8% in 2024 then 6.5% in 2025, this robustness reflecting “the continued strength of domestic demand and the increase in the active population.”