The International Monetary Fund (IMF) has revised its global economic growth forecast upward for 2024, citing improvements in leading economies.

The projection for global growth this year is now 3.1%, a 0.2-percentage-point increase from October, while the estimate for 2025 remains unchanged at 3.2%.

The upgrade is attributed to the resilience of the US and several large emerging markets, along with fiscal support from China, as stated in the January World Economic Outlook report by the IMF. However, both 2024 and 2025 figures are below the historical annual average of 3.8%, influenced by tight monetary policies, the withdrawal of fiscal support, and low productivity growth.

Highlighting a faster-than-expected decline in inflation, the IMF anticipates global headline inflation to decrease to 5.8% in 2024 and 4.4% in 2025, driven by easing supply disruptions and restrictive monetary policies.

The US economy is expected to grow by 2.1% in 2024, with an upward revision of 0.6 percentage points, while the growth forecast for 2025 has been adjusted to 1.7% from 1.8%.

China's growth projection for 2024 has been raised by 0.4 percentage points to 4.6%, and it is expected to grow by 4.1% in 2025, unchanged from October.

The euro area's GDP is projected to increase by 0.9% in 2024 and 1.7% in 2025, reflecting downgrades of 0.3 percentage points and 0.1 percentage points, respectively.

Türkiye's economic growth forecast for 2024 has been raised to 3.1%, up from the October estimate of 3%, while it remains stable at 3.2% for 2025.

India's economy, buoyed by resilient domestic demand, is estimated to grow by 6.5% in both 2024 and 2025, with upgrades of 0.2 percentage points for both years compared to October.

The IMF's revised forecast is a positive sign for the global economy, but it is important to note that there are still significant risks to the outlook.

The war in Ukraine, rising interest rates, and ongoing supply chain disruptions could all derail the recovery. However, if these risks can be mitigated, the global economy could be on track for a moderate expansion in 2024 and 2025. (ILKHA)