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Global Outlook 2024

2024 Economic Outlook: Growth & Lower Inflation Ahead

Nov 13, 2023

The global economy 2023 exceeded expectations, with GDP growth surpassing forecasts globally and exceptionally in the US. Inflation rates have decreased significantly, suggesting a positive economic trajectory into 2024​​.

Key Highlights

  1. Economic Performance and Forecast:
    • Global GDP growth in 2023 reached 2.7%, surpassing the Bloomberg consensus forecast. The US showed robust growth, exceeding expectations by two percentage points​​.
    • 2024 global growth is forecasted at 2.6%, slightly above potential growth. The US is expected to continue outperforming other developed markets​​.
  2. Inflation and Monetary Policy:
    • Core inflation, which was high in 2022, has been reducing, and it is expected to fall to 2-2½% by the end of 2024​​​​.
    • Major central banks in developed markets are likely finished with interest rate hikes and might start rate cuts in the second half of 2024. The Bank of Japan is expected to exit yield curve control, and China is predicted to continue its economic policy stimulus​​.
  3. Labor Market and Wages:
    • Unemployment rates have decreased, now sitting below pre-pandemic levels. Wage growth is normalizing towards target-consistent levels, indicating limited inflationary pressure from this sector​​.
  4. Risks and Challenges:
    • Despite positive economic indicators, concerns about a recession persist, particularly in the US, where the median forecast estimates a 50% chance of recession in the next 12 months​​.
    • Potential risks include geopolitical tensions, particularly in the Middle East, and the possibility of further interest rate hikes if inflation unexpectedly rises​​.
  5. Investment Outlook:
    • The market outlook remains complex, with asset valuations appearing richer than usual and a shift towards baseline economic forecasts​​.
    • Government bond valuations have improved, and a balanced asset exposure is recommended over a focus on cash​​.
  6. Long-Term Implications:
    • Factors like global government deficits, higher investment cycles, and productivity boosts from generative AI are expected to influence long-term interest rates​​.
    • The global economy is moving away from the post-global Financial Crisis environment, marked by low inflation and negative real yields, towards a more normalized investing environment with positive actual expected returns​​.


The global economic outlook for 2024 is cautiously optimistic, with expected growth outperformance, reduced inflation, and strong labor markets. However, the environment remains complex due to elevated valuation risks and potential geopolitical tensions. Investment strategies should consider these dynamics, focusing on a balanced asset mix and being mindful of the evolving monetary policy landscape.

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