Fitch downgrades global GDP growth forecast for 2022-2023

Fitch Ratings has lowered its forecast for global GDP growth for the current year to 2.9% from 3.5%, says Fitch Ratings in its Global Economic Outlook (GEO) for June 2022, Report informs.

“We have lowered our world 2022 GDP growth forecast by 0.6pp since the March GEO to 2.9%. We have revised down our growth forecasts for the US by 0.6pp to 2.9% and eurozone by 0.4pp to 2.6%. We have cut our world growth projection for 2023 by 0.1pp to 2.7%,” Fitch noted.

“Recent lockdowns in China are adding to global manufacturing supply-chain pressures. Energy and food supply disruptions from the Russia-Ukraine war are having a swifter impact on European inflation than expected,” reads the report.

“In this context, we now expect the Fed to raise interest rates to 3.0% by 4Q22 and to 3.5% by 1Q23. We now expect the ECB to raise rates by 100bp this year followed by 50bp in 2023.”