Page 52 - ΝΑΥΤΙΚΑ ΧΡΟΝΙΚΑ - ΟΚΤΩΒΡΙΟΣ 2024

ECONOMIC OUTLOOK

US domestic economy, though significant trade
tariffs could harm Chinese and European export-
ers. That could result in fewer climate-related pol-
icies, while severe weather events may continue
to cause unexpected and significant disruptions
globally’’.
The outlook for Europe is taking a turn for the
better. Chief economists are modestly optimistic
that conditions in Europe are set to improve, with
almost twice as many (53%) expecting moderate
or better growth in 2025 as in 2024 (29%).
‘‘In the European Union, the modest recovery is
set to continue, though more slowly than in the
US. The manufacturing sector remains weak,
although services are performing better. As
real incomes improve, European consumers will
spend more; we see annualised growth of around
1% in 2025. In the shorter term, we see no chal-
lenge to the European Central Bank’s rate-cutting
path and a move to a neutral rate of between 1.5%
and 2%’’, says Samy Chaar.
The report notes that the outlook remains stron-
gest for parts of Asia. South Asia is a clear stand-
out performer, with strong or very strong growth
expected by seven out of 10 chief economists.
Central Asia, East Asia, and the Pacific are not
US Federal Reserve The regional outlook remains varied too far behind. By contrast, China’s weak outlook
Board Chairman Chief economists are expecting a soft landing continues to make it an outlier among the Asian
Jerome Powell in the US despite a protracted period of tight economies.
responds to a
question from the monetary policy and the recent string of job In the other areas covered by the survey, the
news media after market disappointments. Almost nine out of 10 outlook is either stable or positive. Growth pros-
the Fed cut its expect moderate or better growth this year and pects are positive but remain uncertain for the
benchmark interest
rate half-point next. The upcoming election marks a political Middle East and North Africa. At the same time,
following its two- and economic inflexion point for the US and the Latin America, the Caribbean, and Sub-Saharan
day conference at world. Eight out of 10 respondents agree that the Africa look poised to outperform global growth
the Federal Reserve
in Washington, DC, election result will have a major impact on global averages.
USA, 18 September economic policy. “The rest of the world is a mixed bag. Econo-
2024.
Ludovic Subran, Chief Economist of Allianz, notes mies with strong domestic demand or tech-based
that “the upcoming US elections are pivotal for trade are likely to outperform. Many central
Credit: the economic outlook in the US and the world. A banks will have additional room to ease as the
EPA/SHAWN THEW re-election of Donald Trump would be quite infla- Fed steadily reduces its policy rate’’, says Paul
tionary due to the trade, immigration, and dollar Gruenwald, Global Chief Economist of S&P Global
policy choices laid out on the campaign trail. That Ratings.
could force the Fed to pause its loosening cycle
halfway through, cause recession risks in the US, Global inflation is continuing its downward tra-
and send shockwaves to the emerging world. jectory, but the pace of deceleration is easing
Conversely, the election of Kamala Harris would There is a strong level of confidence that the US
increase the pressure on fiscal consolidation and has turned a corner on inflation, with the per-
lower growth prospects for the US’’. centage of respondents expecting high inflation
On the same subject, Marieke Blom, Chief Econ- dropping from 21% in 2024 to just 6% in 2025.
omist and Global Head of Research at ING Group, Expectations are that inflation is heading towards
notes the following: ‘’The next US president will the desirable direction everywhere. Regarding
undoubtedly leave their mark on both the domes- China, for example, the number of leading econ-
tic and the global stage. A Democratic win may omists expecting very low inflation has dropped
lead to more fiscal consolidation, less protec- from 33% in 2024 to 16% in 2025, indicating
tionism, lower interest rates, and a softer USD. optimism that the deflationary period will soon
Conversely, a Republican win could support the come to an end.

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