The Strategist

Fitch improves global GDP growth forecast for 2021

06/16/2021 - 03:41

International rating agency Fitch Ratings has improved its forecast for global GDP growth in 2021 to 6.3% from the 6.1% expected in March, the agency said in its June GEO - World Economic Outlook.

"Incoming data, an earlier opening of the services sector in the US and Europe, and the impact of support measures underpin the revision," the agency said in a statement. Global GDP growth will slow to 4.3% in 2022, the agency said.

Fitch explains that a faster-than-expected global economic recovery supports prices, but a number of factors will depress the rate of inflation in 2022.

The outlook was improved for most advanced economies: GDP growth in the US is now expected to be 6.8% this year rather than 6.2%, in the eurozone - at 5% instead of 4.7%, in the UK - at 6.6% versus 5% in March.

Meanwhile, the forecast for Japan has been worsened to 2.5% from 3.6%, while the forecast for China remains at 8.4%, the report said. Growth in developing countries excluding China is forecast at 5.9%, down from the 6% the agency had previously expected.