Global Growth Outlook 07/2022: Double shock

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Juni 2021 July 2022 GLOBAL GROWTH OUTLOOK

Juni 2021

Double shock GLOBAL GROWTH OUTLOOK

Juni 2022

Covid and war jeopardising global economic recovery

The double shock of the Russian war in Ukraine and China’s zero-Covid strategy is fuelling inflation and cutting growth worldwide. There is no easy economic policy response to this situation.

The global economy will only grow by about three percent this year. At the start of the year we forecast four percent. Global trade is expected to grow by a solid five percent, but this is only half the increase seen last year.

The German economy is only expected to grow around 1.5 percent this year. Our start-of-year forecast was 3.5 percent. Growth is likely to be only half that registered last year, with exports and investment activity greatly restrained.

Die amerikanische Lokomotive der Weltwirtschaft

▪ Transport and logistics prices are soaring globally due to the war and the panAufschwung im Norden, Risiken im Süden demic, leading to persistent supply bottlenecks. These problems are curbing industrial production. ▪

High inflation in the euro area and Germany needs a monetary policy response. The European Central Bank is tightening the reins to bring inflation back down towards two percent by 2024.

Federal Reserve opts for monetary policy normalisation to tackle very high inflation in the United States. If successful, this could lead to a soft landing in monetary policy. However, the turnaround in interest rates harbours recession risks for the United States next year.


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Global Growth Outlook 07/2022: Double shock by Bundesverband der Deutschen Industrie e.V. - Issuu