## EXECUTIVE SUMMARY

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### Global outlook and growth
- The global recovery from the COVID-19 pandemic and Russia’s invasion of Ukraine remains slow and uneven.
- Global growth is forecast to slow from 3.5 percent in 2022 to 3.0 percent in 2023 and 2.9 percent in 2024.
- The projections remain below the historical (2000–19) average of 3.8 percent.
- The forecast for 2024 is down by 0.1 percentage point from the July 2023 Update to the World Economic Outlook.
- For advanced economies, growth is expected to slow from 2.6 percent in 2022 to 1.5 percent in 2023 and 1.4 percent in 2024.
  - This reflects stronger-than-expected US momentum but weaker-than-expected growth in the euro area.
- Emerging market and developing economies are projected to have growth modestly decline, from 4.1 percent in 2022 to 4.0 percent in both 2023 and 2024.
  - The 2024 forecast contains a downward revision of 0.1 percentage point, reflecting the property sector crisis in China.
- Forecasts for global growth over the medium term are 3.1 percent, noted as being at their lowest in decades and implying weak prospects for catch-up to higher living standards.
- Economic activity still falls short of its prepandemic path, especially in emerging market and developing economies, with widening divergences among regions.
- Several forces hold back the recovery, including long-term consequences of the pandemic, the war in Ukraine, increasing geoeconomic fragmentation, effects of monetary policy tightening, withdrawal of fiscal support amid high debt, and extreme weather events.

### Inflation
- Global inflation is forecast to decline from 8.7 percent in 2022 to 6.9 percent in 2023 and 5.8 percent in 2024.
- The forecasts for 2023 and 2024 are revised up by 0.1 percentage point and 0.6 percentage point, respectively.
- Inflation is not expected to return to target until 2025 in most cases.
- Near-term inflation expectations have risen and could contribute—along with tight labor markets—to core inflation pressures persisting and requiring higher policy rates than expected.

### Risks to the outlook
- Risks are more balanced than six months ago due to resolution of US debt ceiling tensions and decisive actions by Swiss and US authorities to contain financial turbulence.
- The likelihood of a hard landing has receded, but the balance of risks to global growth remains tilted to the downside.
- Specific downside risks include:
  - China’s property sector crisis deepening, with global spillovers, particularly for commodity exporters.
  - Persistence of core inflation pressures driven by higher inflation expectations and tight labor markets, potentially necessitating higher policy rates.
  - More climate and geopolitical shocks causing additional food and energy price spikes.
  - Intensifying geoeconomic fragmentation constraining the flow of commodities across markets, causing additional price volatility and complicating the green transition.
  - Rising debt-service costs: more than half of low-income developing countries are in or at high risk of debt distress.

### Policy implications and recommendations
- There is little margin for error on the policy front.
- Monetary policy:
  - Central banks need to restore price stability while using policy tools to relieve potential financial stress when needed.
  - Effective monetary policy frameworks and communication are vital for anchoring expectations and minimizing the output costs of disinflation.
- Fiscal policy:
  - Fiscal policymakers should rebuild budgetary room for maneuver and withdraw untargeted measures while protecting the vulnerable.
  - Faster and more efficient multilateral coordination is needed on debt resolution to avoid debt distress.
- Structural reforms and cooperation:
  - Reforms to reduce structural impediments to growth—including by encouraging labor market participation—would smooth the decline of inflation to target and facilitate debt reduction.
  - Cooperation is needed to mitigate the effects of climate change and speed the green transition, including ensuring steady cross-border flows of the necessary minerals.

*Source: executive summary (execsum) from the IMF October 2023 World Economic Outlook executive summary PDF.*

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_Source: https://www.imf.org/-/media/files/publications/weo/2023/october/english/execsum.pdf_