KUALA LUMPUR – Moody’s Analytics has revised its global real gross domestic product (GDP) forecast for 2022 and 2023 downward to 2.7% and 2.3%, respectively.
This is from forecasts of 4.2% for 2022 and 3.6% for 2023 in January.
“While the global economy is projected to grow in 2022, any policy missteps or additional risks would increase the threat of a worldwide recession in the next 12 months above its current assessment of just over even odds,” Moody’s Analytics said in a note today.
“The global economy is at a crossroads as the nascent post-pandemic recovery has quickly morphed into a darker and more fragile environment.
“Record-high inflation in the US and Europe from supply shortages and surging commodity prices following Russia’s invasion of Ukraine are weighing on the global expansion and are compounded by an aggressive monetary policy response.
“At the same time, China’s economy is facing challenges on multiple fronts, including a cooling property market and a build-up of risks in the financial sector,” it added.
As a result, Moody’s Analytics said global growth fell in the second quarter on an annualised basis for the first time since the depths of the virus outbreak in early 2020, driven by contractions in the US, the UK, and China.
“More broadly, performance remains uneven among the world’s major economies – the US, China, Japan, India, and the five largest economies in Western Europe.
“Outcomes will continue to diverge through 2023 due to differing trade and investment linkages to Russia and Ukraine, particularly in relation to energy products,” it said. – Bernama, September 26, 2022
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