IMF is not expecting the global recession in 2023

In between of rising inflation, crashing down stock market and much more happening in the economic sector, a good news comes from the side of IMF (International monetary fund). According to their latest report, the world will not hit a global recession in 2023. It is great news when so many things are happening in the economic sector for the past few years. After the COVID pandemic, most of the country has to face a slowing down of the economy, rising inflation, many companies have to shut down permanently, and much more.

What is in the latest report

In their report, IMF said, “The global fight against inflation, Russia’s war in Ukraine, and a resurgence of COVID-19 in China weighed on global economic activity in 2022, and the first two factors will continue to do so in 2023.” The world will have to bear the weight of COVID-19 in China and Russia Ukraine war, for one year. It will play a part in the economy in 2023. The inflation will reduce but not that much to achieve the figures of pre COVID era.

According to IMF, global inflation is expected to fall to 6.6% in 2023 which was 8.8% in 2022. It is still very much higher than what was in pre COVID era. In 2017-19, global inflation was at the level of 3.5%.

Global GDP growth is expected to fall to 2.9% in 2023 from 3.4% in 2022. But IMF expects it to recover in 2024 and rise at the level of 3.1%. Rising central bank rates to fight inflation and Russia Ukraine war is weighing highly on the economy and slowing down it. “The global economy will slow down this year before 2024, but a global recession is not in our baseline” IMF tweeted that today morning. It was a big relief for people, industrialists and the government who were scared of the possibility of the global recession. But, IMF didn’t expect a recession, that doesn’t mean we are 100% safe. The global economy is in very bad shape now. Maybe in the worst shape of this decade. The historical GDP growth was achieved in the era of 2000-19 according to IMF, which was at 3.8%, and we are very far away from it. IMF expected the global GDP growth to reach 3.1% in 2024 which is still 0.7% lower than the average of the 2000-19 era.

The COVID pandemic and after that the Russia-Ukraine war put the global economy in a bad shape, and it now seems very hard to recover from that. Midst of that, the statement of IMF gives hope to all the governments, where all the governments are fighting hard to slow down the inflation rate somehow.

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