Goldman Sachs Says Global Economic Growth in 2024 Will Exceed Expectations

By Jessel Renolayan

Nov 15, 2023 04:11 AM EST

In a surprising turn of events, Goldman Sachs Research is boldly predicting that the global economy is poised to outperform expectations in 2024, demonstrating resilience in the face of recent challenges.

According to the investment bank forecasts, the world economy is anticipated to grow by 2.6% in 2024 on an annual average basis. Goldman Sachs' forecast notably surpassed the above 2.1% consensus expectation of economists polled by Bloomberg.

Goldman Sachs noted that the United States is set to lead the way among developed markets, estimating a growth rate of 2.1%. This prediction underscored the investment bank's confidence in the resilience and strength of the US economy.

Goldman Sachs' optimistic projections align with its assessment that the global economic landscape is set for a positive trajectory in the coming year.

Goldman Sachs logo
(Photo : Michael M. Santiago/Getty Images)

Positive Outlook for Many Big Economies in 2024, According to Goldman Sachs

Goldman Sachs' economists have consistently maintained an optimistic stance over the past year, expressing confidence that major economies can avoid a recession. 

In its recent report, the bank reiterated its long-standing perspective, emphasizing that the likelihood of a recession in the US is considerably lower than commonly acknowledged - currently estimated at a mere 15% over the next 12 months. 

The investment bank's economists have a positive outlook for real disposable income growth. In a press release about the report, Goldman Sachs wrote, "Our economists have a positive outlook for real disposable income growth at a time of much lower headline inflation and still-strong labor markets." 

While they see US real income growth poised to slow from its very strong 2023 pace of 4%, CNBC reported that "it is still purported to support consumption and GDP growth of at least 2%."

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Central Banks Interest Rate Reductions as a Proactive Measure in Response to Economic Challenges

Goldman Sachs highlighted the potential for central banks to address economic concerns by having the flexibility to lower interest rates if they are concerned about the economy slowing. 

The analysis underscored the strategic capability of central banks to implement interest rate reductions as a proactive measure in response to economic challenges, signaling their readiness to navigate and counteract potential downturns effectively.

"This is an important insurance policy against a recession," Goldman Sachs Research Chief Economist Jan Hatzius wrote in the team's report titled "Macro Outlook 2024: The Hard Part Is Over."

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