[News page-Taiwan Strait Net].
On December 29, the Financial Times** published an editorial entitled "Reasons for Optimism about the Global Economy", the full text of which is compiled as follows:
Some psychologists believe that happiness is the result of reality that exceeds people's expectations. If that's the case, then 2023 is already a pretty pleasant year – at least for economists. According to the "Global Economic Surprise Index" released by Citibank Group, the figures for this year** have been worse than the actual data. The economic trends underpinning this reality also provide ample reasons for optimism in 2024.
First, the international economy is remarkably resilient. Since 2020, the international economy has experienced the coronavirus pandemic, the war in Europe, and the chaos of the ** chain – all factors that have combined to trigger the highest inflation and the most aggressive interest rate hike cycle in decades. However, economies have adapted better than expected to the new situation, which continues in 2023. According to global aggregate data from Fitch International Credit Ratings***, global gross domestic product (GDP) was more than 9% higher in the third quarter of 2023 than before the pandemic. Companies have rerouted their logistics, Europe has moved closer away from Russian gas, and higher interest rates have not led to a spike in unemployment. This resilience provides a solid foundation for the new year.
Second, the scourge of inflation is rapidly receding. Last year, the global price rate was 89%, which is expected to fall to 51%。Food (from wheat to cooking oils)** has been significantly reduced, and soaring energy** is retreating. A series of impacts caused by the impact of the COVID-era ** chain have also been mitigated. Services inflation remains stubbornly high, but this is largely due to a strong job market and rapid wage growth.
Third, concerns about a "Table Mountain" monetary policy cycle, in which peak interest rates will remain in place for longer, have begun to wane. In 2024, central banks may start cutting interest rates sooner than expected. This will be a relief for many households and businesses. The impact of rate hikes has been contained despite the collapse of three U.S. regional banks and Credit Suisse in March, which crashed in March. In fact, from zombie companies to banks with weak capital, the current interest rate cycle has effectively exposed their weaknesses.
Financial markets are booming. This month, Wall Street's major stock indexes are near or above all-time highs. Even bonds ended the year strongly. In addition, the likelihood of a soft landing for the US economy in 2024 (i.e., the Fed will bring inflation under control without triggering a recession) has increased.
Not all economies are expected to perform well. Economic activity in the UK and Germany was sluggish. But the outlook for some other economies is positive. India, Mexico and Vietnam are benefiting from the paradigm shift, and investors are eager to increase their investment in these countries next year. Some localities have re-become cautious in managing their economies. After a decade-long hiatus, Greece's sovereign debt rating has returned to "investment grade". In Turkey and Argentina, some unorthodox practices have also been curbed. Central banks in many developing countries are leading the way in controlling inflation.
Finally, 2023 is by no means the quiet year that some expected for the tech industry. Chat-to-Generate Pre-trained Converter (ChatGPT) became the fastest-growing app ever, and the buzz around generative AI technology is driving the adoption of generative AI technology by businesses in 2024 that could help support productivity gains. Some other innovations in 2023 also have a bright future. Regulatory approval of ** drugs, such as semaglutide developed by Novo Nordisk, may help reduce the medical burden. In addition, Toyota Motor Corporation's progress in solid-state batteries could change the EV industry landscape.
Knowing more is not a reason to be complacent. The global economy will face several battles in 2024: from critical elections to rising sovereign debt. However, after this year's resilient performance, it is entirely possible that next year's reality will be better than expected.
*: Refer to the news network compiled by Shen Jian).