The Downgraded Global Economic Outlook For 2023, Is At Odds With Market Optimism.
GLOBAL ECONOMIC GROWTH IS FORECAST TO BARELY CLEAR 2% THIS YEAR, According to a Reuters poll of economists who said the greater risk was a further downgrade to their view, at odds with widespread optimism in markets since the start of the year. Falling energy prices, a slowdown in inflation in most economies from multi-decade highs, an unexpectedly resilient euro zone economy, and China’s economic reopening have led traders to speculate the downturn will be milder. That has driven MSCI’s all-country world index of shares up nearly 20% from October lows, hitting a five-month closing high on Wednesday, despite the greater risk central banks keep interest rates higher for longer rather than cut them. But economists as a whole were much less upbeat, paring back growth forecasts for this year and next from 2.3% and 3.0%, respectively, in an October 2022 poll to 2.1% and 2.8%. Their dourer mood flew in the face of some notable upgrades by banks in recent weeks. Read More