In its latest Global Macroeconomic Outlook 2024-25 report, Moody's envisions a shift in the global economic landscape. Projections indicate a moderation in G20 growth to 2.1% in 2024, down from 2.8% in 2023, with an anticipated acceleration to 2.6% in 2025.
Emerging market countries showcase diverse economic strengths, with India, Brazil, Mexico, and Indonesia surpassing expectations. Conversely, the outlooks for Turkey and Argentina remain highly uncertain, according to the report.
India's Economy: A Beacon of Sustained Growth
The report highlights India's sustained economic growth, propelled by robust domestic demand. Factors such as thriving goods and services tax collections, surging auto sales, rising consumer optimism, and double-digit credit growth contribute to the resilience of urban consumption demand, particularly during the ongoing festive season.
While rural demand exhibits signs of improvement, it remains vulnerable to the unpredictability of monsoons, which could impact crop yields and farm income, states the report. Nevertheless, expanding manufacturing and services PMIs, coupled with healthy core industries' output growth, provide evidence of a solid economic momentum in the country.
Key Highlights and Regional Insights
The report provides key highlights for various regions, including:
- United States: Slight adjustments to growth forecasts, a rapidly growing job market, and consumers becoming more price-sensitive.
- Euro Area Economies: Projections assume continued economic deceleration due to rising interest rates affecting economies.
- China: Growth projections revised to 5.0% for 2023, followed by 4.0% in 2024 and 2025, envisioning an acceleration in growth momentum.
- Other Advanced Economies and Emerging Markets: Limited changes from August, with downward revisions for Canada, Australia, and Korea acknowledging the impact of tight financial conditions on economic momentum.
(With agency inputs)
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