World Bank Projects Weak Global Growth Amid Rising Interest Rates

Logo The New York TimesThe New York Times
2023-06-06 13:30:07  • 3 mins

A new report projects that economic growth will slow this year and remain weak in 2024.

The World Bank said on Tuesday that the global economy remained in a precarious state and warned of sluggish growth this year and next as rising interest rates slow consumer spending and business investment, and threaten the stability of the financial system.

The banks tepid forecasts in its latest Global Economic Prospects report highlight the predicament that global policymakers face as they try to corral stubborn inflation by raising interest rates while grappling with the aftermath of the pandemic and continuing supply chain disruptions stemming from the war in Ukraine.

The World Bank projected that global growth would slow to 2.1 percent this year from 3.1 percent in 2022. That is slightly stronger than its forecast of 1.7 percent in January, but in 2024 output is now expected to rise to 2.4 percent, weaker than the banks previous prediction of 2.7 percent.

Rays of sunshine in the global economy we saw earlier in the year have been fading, and gray days likely lie ahead, said Ayhan Kose, deputy chief economist at the World Bank Group.

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