Economists around the world expect only a gradual decline in high global inflation. Global inflation is likely to average 7.1 percent in the new year and then fall to 5.8 percent in 2024, according to the quarterly survey released Thursday by the Ifo Institute in Munich and the Institute for Swiss Economic Policy.
“The expectations at the beginning of the year are encouraging because the experts see slightly lower inflation rates compared to the previous quarter,” says Ifo researcher Niklas Potrafke. “Still, inflation remains at a very high level.” Expectations also remain relatively high in the longer term – with a view to 2026 – at 4.5 percent.
Further rate hikes by the ECB likely
In Western Europe (5.4 percent), North America (5.2 percent) and Southeast Asia (5.3 percent), inflation expectations for 2023 are well below the global average. “The interest rate hikes by the ECB in December also contributed to the fall in inflation expectations in Europe,” said Potrafke. The European Central Bank (ECB) raised its key interest rate to 2.5 percent last year and is likely to do so a few more times in 2023.
In contrast, inflation expectations are particularly high in South Asia (23 percent), South America (25 percent), North Africa (32 percent) and East Africa (nearly 35 percent), as the survey shows. In December, 1537 experts from 133 countries took part.
Inflation will also continue in Austria. For example, IHS boss Klaus Neusser recently expected inflation of around 5 percent for the coming year. A further decline is expected for 2024. However, it is “the question” whether the ECB’s target of 2 percent will be achieved in the medium term.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
