Global Macroeconomic Outlook - Q4 2023 Update

Global Macroeconomic Outlook - Q4 2023 Update

Summary

The global economic environment is changing, marked by a gradual increase in consumer confidence and a temporary cessation of further rate hikes amid easing inflation. Positive factors such as anticipated real disposable income growth, a diminished influence of rate hikes on growth, and the expected recovery in industrial activity are set to strengthen global growth in the year ahead. However, potential challenges such as the possible resurgence of inflation and the escalation of geopolitical crises add an element of uncertainty to the improving economic environment.

GlobalData’s Q4 2023 update reflects this intricate economic scenario. The 2023 global economic growth projection has been revised upward by 0.3 percentage points to 2.4%. Nevertheless, the 2024 forecast has been adjusted downward by 0.2 percentage points to 2% due to factors such as deteriorating business sentiment, high financing costs, the potential resurgence of inflationary pressure, and weakened external demand.

In this evolving economic environment, Asia-Pacific (APAC) is poised to lead in 2023 with the highest growth rate. However, the growth projection for APAC was adjusted downward in the Q4 2023 update, primarily due to disruptions in China and reduced external demand. Similarly, the Middle East and Africa (MEA) region reported downward revisions in its growth projections due to the ongoing geopolitical tensions and reduction in oil production. On a brighter note, economic growth projections for Europe and the Americas have been raised owing to improved consumer confidence and a reduction in inflation.

Scope

• In the Q4 2023 update by GlobalData, the global growth projections for 2024 were reduced by 0.2 percentage points to 2% compared to the Q3 2023 update. This downward revision can be attributed to factors such as higher interest rates, the ongoing Russia-Ukraine conflict, and geopolitical tensions. Additionally, the recent Israel-Hamas conflict has introduced further uncertainty, particularly in relation to oil prices and their potential impact on the global economy.

Reasons to Buy

• GlobalData's Global Macroeconomic Outlook Report identifies, analyzes, and forecasts key development of the global economy. The report provides a 360-degree view of the economy which can be used as a strategic tool to understand market dynamics, business potential and direction of operations.