Global economy to expand 3.1% in 2023, IFF report projects

GUANGZHOU, China, Oct. 30, 2023 /PRNewswire/ -- Global economy will slow to 3.1% in 2023 as monetary policy tightening, the war in Ukraine and lingering effects of the Covid-19 pandemic continue to affect global growth, the IFF Global Finance and Development Report 2023 projects. 

China's GDP is projected to grow 5.2% in 2023 and slow to 5% in 2024 as the country rolled out a series of stimulus packages, according to the Report released during the IFF 2023 Annual Meeting on Saturday. 

The Report now projects global economy will remain weak in 2024 with global GDP expanding 3.1%.

Global consumer prices will fall to 7% this year, down from 9.2% in 2022 and inflation will drop further to 5.8% in 2024.

U.S. economy is to expand 2% in 2023 while the EU GDP is projected to grow 0.8% this year and 1.5% in 2024.

Looking ahead, global economy still faces strong headwinds - core inflation in many countries still stay well above central banks' targets as geopolitical issues including the war in Ukraine could further rock global energy and food markets; monetary policy tightening in an effort to rein in inflation could further dampen demand; geopolitical tensions could further trigger economic slowdown and runaway inflation; the uncertainty of China's economic growth momentum this year could have negative impact on global growth.

The Report recommends monetary policy tightening without sacrificing global financial stability, consolidating fiscal position while protecting vulnerable groups, accelerating structural reform and deepening international cooperation and promoting multilateralism.

The Report also looked at the global finance market including the US regional bank crisis, US debt ceiling standoff, the impact of policy rates on currency performance and China's local government and corporate debts.

Vulnerabilities in China's financial system are unlikely to escalate into systematic risks according to the Report.

The Report also examines global and China's green bond markets, carbon markets as well as global green finance policies. The IFF calls on the international communities to join force in fighting climate crisis.

The Report also provides insight into global digital finance, particularly the application of technologies including big data, blockchain and artificial intelligence.

The IFF Global Finance and Development Report, released every year during the IFF Annual Meeting, offers insights into China's and global economy as well as the financial markets.