The World Bank has increased its forecast for global economic growth for 2024 and 2025, taking into account the recent easing of policies and the sustained strength of exports. According to the bank, the growth rate for 2024 is expected to be 4.9%, up 0.1 percentage points from the previous forecast, while the growth rate for 2025 is expected to be 4.5%, up 0.4 percentage points.
However, the World Bank also warned that the ongoing easing of policies and the subsequent increase in exports may slow down consumer spending in 2025 due to the negative wealth effect of declining housing prices and lower income growth.
To address the vulnerability issues, the World Bank recommended that governments implement structural reforms to strengthen the social safety net, resolve the defects in the housing finance mechanism, address the debt burden, and reform the tax framework.
The report also noted that the global economic outlook is subject to various risks, including trade tensions, rising protectionism, and fiscal policy normalization.