Fitch Ratings raised forecast of China’s economic growth in 2023 to 5.6% from 5.2%

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Fitch Ratings has raised its forecast for global GDP growth in 2023 to 2.4%, from 2% in its March forecast, but lowered the forecast for 2024 growth to 2.1% from 2.4%, due to longer lags in the impact of higher interest rates, along with weaker base effects for EM growth. 

It raised China’s 2023 forecast to 5.6% from 5.2% after a swifter-than-expected reopening rebound in the first quarter, saying that although the recovery has faltered somewhat in recent months, consumption continues to normalise and macro policy is starting to be eased. 

The agency revised up EM ex-China growth for 2023 to 2.9% from 2.0% with Brazil, India, Mexico and Russia seeing substantive improvements, it said. It raised the forecast for US growth in 2023 to 1.2% from 1% as consumption and job growth remain robust and said it still expects the US Federal Reserve tightening to push the economy into a mild recession, but the timing of this has been pushed out to 4Q23-1Q24.