Global economic growth is projected to decelerate in 2022. The Institute of International Finance (IIF, Washington) now expects global GDP to grow only by 2.3% this year after expanding by 5.8% in 2021. GDP growth in advanced economies is forecast at 2.1%, in emerging markets and developing economies – at 2.5% (in China – at 1.5%).
The outlook for growth in the Euro Area has been significantly revised down from 3% to 1%.
The outlook for the Russian economy is also more negative than for other economies: it is expected to decline by 15%. Ukraine's GDP is projected to shrink by 35%. This will have an impact on other countries in the region that will face a slowdown in economic growth.
The IIF expects China’s GDP to contract by 2.4% in Q2 compared to the same period last year. China’s GDP is projected to grow by 3.5% (down from its previous forecast of 5.1%) by the end of 2022.
Yesterday the Moody's Rating Agency updated its Macro Outlook. It now sees growth in advanced economies this year coming in at 2.6%, down from its previous forecast of 3.2%. The Agency also lowered its call for emerging markets and developing economies to 3.8% from 4.2%. The Agency does not currently expect a recession in any G20 country. However they believe that aggressive monetary tightening could become a catalyst for such a scenario.