- FULL REPORT
- EXECUTIVE SUMMARY
- FOREWORD
- BLOG BY PIERRE-OLIVIER GOURINCHAS
- OCTOBER 2023 DATABASE
- PRESS CONFERENCE
Report Projections Summary
According to IMF latest projections, global growth will slow from 3.5 percent in 2022 to 3 percent this year and 2.9 percent next year, a 0.1 percentage point downgrade for 2024 from our July projections. This remains well below the historical average.
Headline inflation continues to decelerate, from 9.2 percent in 2022, on a year-over-year basis, to 5.9 percent this year and 4.8 percent in 2024. Core inflation, excluding food and energy prices, is also projected to decline, albeit more gradually than headline inflation, to 4.5 percent in 2024.
As a result, projections are increasingly consistent with a “soft landing” scenario, bringing inflation down without a major downturn in activity, especially in the United States, where the forecast increase in unemployment is very modest, from 3.6 to 3.9 percent by 2025.
Global inflation is forecast to decline steadily, from 8.7 percent in 2022 to 6.9 percent in 2023 and 5.8 percent in 2024. But the forecasts for 2023 and 2024 are revised up by 0.1 percentage point and 0.6 percentage point, respectively, and inflation is not expected to return to target until 2025 in most cases.
Report Summary
The world’s economy is slowly getting better after the problems caused by the pandemic, Russia’s invasion of Ukraine, and the high cost of living. It’s been a tough time, but we’re still moving forward. However, the growth is not very fast, and it’s not the same everywhere – some places are doing better than others.
At the end of last year, the global economy hit its lowest point, but we’re now getting a handle on rising prices. Still, we might not be able to return to how things were before the pandemic, especially in countries that are still developing.
Our latest predictions say that global growth will go from 3.5 percent in 2022 to 3 percent this year and 2.9 percent next year. That’s lower than what we’d normally expect.
Prices have been going up, but they are starting to slow down. In 2022, prices went up by 9.2 percent, but this year, it’s expected to be 5.9 percent, and in 2024, it might be 4.8 percent. The prices that don’t include food and energy are also going down, but not as quickly as overall prices.
So, we might be able to get prices under control without causing a big economic downturn, especially in the United States, where unemployment is only expected to go up a little bit.
But there are some differences. Advanced economies are slowing down more than developing ones. The US is doing better than expected, while the euro area isn’t doing as well. Many developing countries are doing better than we thought, except for China, which has problems with its real estate market.
There are three big things affecting the economy. First, the demand for services is going down, which is hurting service-based economies. Second, to control prices, we’ve had to make money harder to get, which is causing problems in some places, especially if people have a lot of adjustable-rate mortgages. Third, rising energy prices are causing issues for countries that depend on Russian energy.
So, while things are improving, it’s not happening everywhere at the same speed, and there are some challenges we still need to overcome.
