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IMF's outlook for global improvement.

 


In recent weeks, positive data from Europe and the US have boosted hopes that the world's economy will avoid a recession this year. Germany's chancellor Olaf Scholz told Bloomberg that the eurozone's largest economy would avoid a recession. At the same time, the Mannheim-based think-tank ZEW said its monthly gauge of investor sentiment had turned positive for the first time since Russia's invasion of Ukraine. Daniel Pinto, head of JPMorgan's investment bank, highlighted the global economy's resilience. «Considering all the things that have happened, the world is much better than you expected».

While the economic downturn in advanced economies no longer appears as bad as feared, Chinese growth has slowed, with Beijing posting a disappointing rate of 3% for 2022. With inflation still too high, central banks should «stay the course» with rising interest rates until inflation falls sustainably, she said. However, financial markets have rallied on lower energy prices, fewer supply chain difficulties and the end of China's zero-Covid policy. Liu He, Beijing's top economic official, told the forum that China's economy would bounce back.

«The Chinese economy will see a significant improvement in 2023». Alan Jope, Unilever's chief executive, said China's rapid reopening was unexpected. US business leaders hailed the Biden administration's Inflation Reduction Act, a $369bn bid to stimulate green investments in America's economy. Mark Hutchinson, chief executive of Fortescue Future Industries, said the tax incentives were «huge . »

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  1. Jonathan18 January 2023 at 13:19

    Things are looking well but let's not kid ourselves here: it's going to be an unpredictable year. We don't know what else will happen in Ukraine and who knows what else can happen in other parts of the world?

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    1. Laurie18 January 2023 at 16:18

      It's good that investors have a positive sentiment as this leads to more investment being done and a growing economy. But yes we can't know for sure if this will be a good year or not. Not yet.

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