Fitch Solutions Country Risk & Industry Research has forecast slower global economic growth from a multi-decade high of 5.5% in 2021 to 4.1% in 2022 and 3.3% in 2023 which will generally be in line with the 5-year average before the Covid-19 outbreak of 3.1%.
According to a report released by the firm on Monday, as of this year, the 2022 forecast will remain below Bloomberg’s consensus estimate of 4.4% even though the consensus is concentrated slightly lower.
He added that the latest Purchasing Management (PMI) index showed strong economic momentum across developed and emerging markets with the number of major economies reading its PMI above the important level of 50 increasing in recent months.
However, such developments could add downside risks to the 2022 growth projection including the emergence of the Omicron variant that makes central banks more hawkish and greater financial market volatility.
In short Fitch Solutions expects slower economic growth to be due;
existing vaccines have yet to be proven effective against Omicron variants and more countries are implementing re -restrictions
US Federal Reserve (Fed) chairman Jerome Powell gave a hawkish signal in recent weeks for a faster -than -expected tapering move
decline in global markets with US equities falling about 4% -5% and oil prices down 15% since late November
