World Bank report says U.S. economy contributes to better global outlook

The global economy is in better shape than it was at the start of the year, largely thanks to the performance of the United States, the World Bank said in its latest forecast on Tuesday. But the sunnier outlook could darken if major central banks, including the Federal Reserve, keep interest rates high.

Global growth is expected to reach an annual rate of 2.6 percent this year, up from a forecast of 2.4 percent in January, the bank said. The global economy is moving closer to a soft landing after recent price surges, with average inflation falling to a three-year low amid continued growth, bank economists said.

While Americans' dissatisfaction with high prices remains a major vulnerability in President Biden's reelection bid, the World Bank now expects the U.S. economy to grow at an annual rate of 2.5%, or nearly a percentage point higher than she had forecast in January. The United States is the only advanced economy growing significantly faster than the bank predicted at the start of the year.

Globally, the situation is generally better today than it was four or five months ago, said Indermit Gill, chief economist at the World Bank. This is largely due to the resilience of the American economy.

TO CATCH UP

Summarized stories to stay informed quickly

The banks' valuation will be news to many Americans who remain concerned about the cost of living. Even though the U.S. economy is outpacing those of Europe and Japan and hiring remains stable, voters are upset about inflation. The price of products such as rent, car insurance and beef have risen sharply in recent months.

Policymakers can highlight progress. Following the Federal Reserve's fastest interest rate increases in decades, the annual rate of overall price growth slowed in April to 3.4%, from a peak of 9.1% reached in April. mid-2022.

But even as the pace of price rises has slowed, the worst inflation since the early 1980s has left prices uncomfortably high. Overall, consumer prices have increased nearly 19% since Biden's inauguration.

These financial pressures have resulted in a weakening of public opinion.

Although public attitudes have improved over the past year as inflation has fallen, consumer confidence slipped in May to its lowest level in five months, according to the monthly index of the University of Michigan. Respondents said they were concerned about the impact of high interest rates, saying they expected hiring to slow and income gains to slow, according to Joanne Hsu, director of the investigation.

Aware of the political danger, the White House considers cost reduction the president's top priority. Biden criticized companies for price gouging and hiding price increases by reducing package sizes, a phenomenon known as Shrinkflation.

Last month, the White House took credit for decisions by Target and Walmart to cut prices on thousands of everyday items, saying the moves were in response to the president's calls for action.

In a May Gallup poll, only 38% of U.S. adults said they had confidence in Biden to do the right thing for the U.S. economy. This is one of the lowest presidential scores reported by the survey institute since 2001.

The World Bank, for its part, credits American dynamism with helping to stabilize the global economy, despite the highest interest rates in years and wars in Ukraine and the Middle East. Employers added 272,000 jobs in May, beating analysts' estimates, the Labor Department reported last week.

However, expected global growth this year and next will remain below the pre-pandemic average of 3.1%. Three out of four developing countries are now expected to grow more slowly than the bank predicted in January, giving them little hope of narrowing the income gap with richer countries.

Despite their mostly optimistic tone, bank officials cautioned that central banks, including the Fed, would likely move slowly to begin reversing the past two years of rising interest rates. This means that global interest rates will remain high, around 4% on average over the next two years, about double the average recorded in the two decades before the pandemic.

Global inflation is expected to ease to 3.5 percent this year, before falling to 2.9 percent next year. But the decline turns out to be more gradual than the bank had expected. And any deterioration that causes monetary authorities to delay reducing borrowing costs could take 0.3 percentage points off expected growth rates.

It is a major risk that interest rates in the global economy will remain higher for a prolonged period and the already weak growth outlook weakens, Gill said.

Bank officials also flagged as a concern global trade, which this year is on pace for its weakest half-decade since the 1990s. By 2024, trading countries have implemented more than 700 restrictions on trade. goods and nearly 160 barriers to trade in services.

Restrictive trade measures have multiplied. They have more than doubled since pre-pandemic times, Gill said.

The rise of protectionism risks slowing the already modest growth rate of the global economy. Popular support in many countries for tariffs on imported goods and industrial subsidies that favor domestic production could further restrict trade flows already under pressure from U.S. rivalry with China and others. geopolitical risks.

The world could find itself stuck in the slow lane, said Ayhan Kose, the bank's deputy chief economist.

Among those likely to suffer if policy interest rates remain high for longer are the 40% of developing countries that risk facing a debt crisis. Many borrowed heavily to finance pandemic-related health care and then to cover food and fertilizer bills that skyrocketed after the war in Ukraine.

They are unlikely to get debt relief immediately and now risk losing trade gains as major economies turn inward, Gill said.

Sources 1/ https://Google.com/ 2/ https://www.washingtonpost.com/business/2024/06/11/world-bank-us-economy/ The mention sources can contact us to remove/changing this article

What Are The Main Benefits Of Comparing Car Insurance Quotes Online

LOS ANGELES, CA / ACCESSWIRE / June 24, 2020, / Compare-autoinsurance.Org has launched a new blog post that presents the main benefits of comparing multiple car insurance quotes. For more info and free online quotes, please visit https://compare-autoinsurance.Org/the-advantages-of-comparing-prices-with-car-insurance-quotes-online/ The modern society has numerous technological advantages. One important advantage is the speed at which information is sent and received. With the help of the internet, the shopping habits of many persons have drastically changed. The car insurance industry hasn't remained untouched by these changes. On the internet, drivers can compare insurance prices and find out which sellers have the best offers. View photos The advantages of comparing online car insurance quotes are the following: Online quotes can be obtained from anywhere and at any time. Unlike physical insurance agencies, websites don't have a specific schedule and they are available at any time. Drivers that have busy working schedules, can compare quotes from anywhere and at any time, even at midnight. Multiple choices. Almost all insurance providers, no matter if they are well-known brands or just local insurers, have an online presence. Online quotes will allow policyholders the chance to discover multiple insurance companies and check their prices. Drivers are no longer required to get quotes from just a few known insurance companies. Also, local and regional insurers can provide lower insurance rates for the same services. Accurate insurance estimates. Online quotes can only be accurate if the customers provide accurate and real info about their car models and driving history. Lying about past driving incidents can make the price estimates to be lower, but when dealing with an insurance company lying to them is useless. Usually, insurance companies will do research about a potential customer before granting him coverage. Online quotes can be sorted easily. Although drivers are recommended to not choose a policy just based on its price, drivers can easily sort quotes by insurance price. Using brokerage websites will allow drivers to get quotes from multiple insurers, thus making the comparison faster and easier. For additional info, money-saving tips, and free car insurance quotes, visit https://compare-autoinsurance.Org/ Compare-autoinsurance.Org is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc. "Online quotes can easily help drivers obtain better car insurance deals. All they have to do is to complete an online form with accurate and real info, then compare prices", said Russell Rabichev, Marketing Director of Internet Marketing Company. CONTACT: Company Name: Internet Marketing CompanyPerson for contact Name: Gurgu CPhone Number: (818) 359-3898Email: [email protected]: https://compare-autoinsurance.Org/ SOURCE: Compare-autoinsurance.Org View source version on accesswire.Com:https://www.Accesswire.Com/595055/What-Are-The-Main-Benefits-Of-Comparing-Car-Insurance-Quotes-Online View photos