Daily Management Review

Fitch downgrades global GDP growth forecast for 2022


According to a press statement from Fitch, the international rating agency reduced its global GDP growth prediction for the current year to 2.9 percent from 3.5 percent.

The forecast for the coming year has also been trimmed by 0.1 percentage point, to 2.7 percent.

The agency decreased the United States' GDP growth prediction for 2022 by 0.6 percentage points to 2.6 percent, while the eurozone's GDP fell by 0.4 percentage points to 2.6 percent.

"The latest COVID-19 manufacturing limits in China are putting further strain on global supply networks. The conflict between Russia and Ukraine has disrupted energy and food supplies, causing prices in Europe to rise faster than planned," according to the press release.

The US Federal Reserve is expected to boost the discount rate to 3% in the second quarter of 2022 and to 3.5 percent in the first quarter of 2023, according to Fitch.

The European Central Bank is expected to hike its benchmark interest rate by 100 basis points this year and 50 basis points in 2023, according to Fitch.

source: fitchratings.com