The International Monetary Fund (IMF) released its latest World Economic Outlook report on October 22, projecting a global economic growth rate of 3.2% for both 2024 and 2025.

According to the IMF, the 3.2% forecast for 2024 aligns with its prediction from July, while the outlook for 2025 has been slightly adjusted down by 0.1 percentage points. The report indicates that developed economies are expected to grow by 1.8% this year and maintain the same growth rate next year. Specifically, the U.S. and Eurozone economies are anticipated to grow by 2.8% and 0.8%, respectively, this year, and by 2.2% and 1.2% next year. Emerging markets and developing economies are projected to see a growth rate of 4.2% for both years, while China’s economy is expected to grow by 4.8% this year and 4.5% next year.

The report highlights an upward revision in growth expectations for the U.S. and emerging Asian economies, alongside a downward adjustment for the Middle East, Central Asia, and Sub-Saharan Africa. Overall, global growth is expected to remain stable, albeit underwhelming, with the IMF forecasting a global growth rate of 3.1% five years from now.

In terms of inflation, the report suggests a slight improvement on a global scale, predicting that the overall inflation rate will decline from an annual average of 6.7% in 2023 to 5.8% in 2024 and 4.3% in 2025. Notably, the recovery of inflation rates in developed economies is expected to outpace that of emerging markets and developing countries. However, despite the easing global inflation, various downside risks are intensifying, including escalating regional conflicts, prolonged monetary policy tightening, market volatility, and a rise in protectionist policies.

The IMF asserts that, in light of current conditions, many countries need to adjust their fiscal policies to ensure public debt sustainability and rebuild financial buffers. Structural reforms are essential to continue supporting the most vulnerable populations and maintaining social safety nets. Furthermore, strengthening multilateral cooperation is critical for accelerating the green transition and supporting debt restructuring efforts. The IMF emphasizes that reducing the risks of geopolitical rifts and enhancing a rules-based multilateral framework is vital to ensure that all economies benefit from future growth.