The final quarter of 2024 showcased a mixed economic landscape as the world economy navigated through persistent geopolitical tensions, moderating inflation rates, and evolving central bank policies. Despite headwinds, global growth maintained modest momentum, driven by emerging markets and a resilient services sector in advanced economies.
In Q3 2024, the global economy showed mixed performance, characterised by high interest rates slowing growth, while inflation moderated. The U.S. and Europe faced weaker consumer spending, whereas India thrived with strong growth. China's recovery lagged, and uncertainties in Q4 hinge on central bank actions and geopolitical factors.
Real interest rates have rapidly increased recently as monetary policy has tightened in response to higher inflation. Whether this uptick is temporary or partly reflects structural factors is an important question for policymakers.