Global Economic Outlook.

Byline: NAZIR AHMED SHAIKH

2022 has arguably been one of the most challenging years, the world has experienced in modern times. It's hard to downplay the scale of the geopolitical and economic uncertainty facing every one of us - from individual households to governments and business leaders. The global economic outlook has deteriorated amid high inflation, aggressive monetary tightening, and uncertainties from both the war in Ukraine and the lingering pandemic.

Global growth is forecast to slow from 6.0% in 2021 to 3.2% in 2022 and 2.7% in 2023. This is the weakest growth profile since 2001 except for the global financial crisis and the acute phase of the COVID-19 pandemic. It is projected that in the year 2022 the growth would be between 2.5 and 2.8%. This is a considerable descending trend from the previous forecasts released in January and May 2022.

Furthermore, the baseline forecast for 2023 is highly indeterminate. Unfortunately, the indicators are showings a further slowdown in global growth. The rising price pressures are now attaining new heights in decades. Definitely, it is hitting vulnerable population groups hard and prompting central banks to quickly tame inflation.

The manufacturing purchasing managers' indexes are one of the key measures of business confidence. This index is indicating broad-based declines during the past six months. The deterioration in business confidence is particularly alarming for many developing countries that are yet to fully recover from the pandemic. International food and energy prices have fallen from recent peaks but continue to be at very high levels. Global trade remains largely subdued as global supply chain disruptions and bottlenecks in international freight movements persist.

Normalization of monetary and fiscal policies that delivered unprecedented support during the pandemic is cooling demand as policymakers aim to lower inflation back to target. But a growing share of economies is in a growth slowdown or outright contraction. The global economy's future health rests critically on the successful calibration of monetary policy, the course of the war in Ukraine, and the possibility of further pandemic-related supply-side disruptions, for example, in China. Global growth is forecast to slow from 6.0% in 2021 to 3.2% in 2022 and 2.7% in 2023. This is the weakest growth profile since 2001 except for the global financial crisis and the acute phase of the COVID-19 pandemic. A US GDP contraction...