The global economic outlook, as projected by the Organization for Economic Cooperation and Development (OECD), looks challenging. Ongoing wars, coupled with rising inflation and high interest rates, are anticipated to lead to a decline in global economic growth from 2.9 per cent this year to 2.7 per cent in 2024.
Two of the world's largest economies, the US and China, are expected to experience stagnation in growth next year, with rates dropping from 2.4 per cent in 2023 to 1.5 per cent. The OECD also foresees a decrease in US inflation rates from 3.9 per cent in the current year to 2.8 per cent in 2024 and further down to 2.2 per cent in 2025.
China's economic growth is projected to slow down from 5.2 per cent in 2023 to 4.7 per cent in 2024. Factors contributing to this decline include China's real estate crisis, rising unemployment, and a slowdown in exports. Consumer consumption in China is expected to decrease due to rising unemployment levels and increased uncertainty, leading to a decline in discretionary purchases.
In the Eurozone, consisting of 20 countries sharing the euro currency, collective growth is predicted to marginally increase to 0.9 per cent in the coming year from 0.6 per cent in the current year. The region's growth will be influenced by factors such as rising energy prices and surging interest rates. These challenges collectively contribute to a complex economic landscape with potential implications for various regions and sectors.