Introduction
Leaders at the World Economic Forum in Davos, Switzerland, have urged countries and businesses to focus on boosting growth and fighting inequality, despite the disruptions caused by the Trump administration.
Global Economic Outlook
The global economy is showing unexpected resilience, with the International Monetary Fund (IMF) forecasting 3.3% global growth for this year. However, troubles like government debt and inequality loom.
Risk of Overheating
The latest readings on the US economy show a jump in growth, with third-quarter GDP expanding at a 4.3% annualized rate. However, there are risks to boosting the economy through interest-rate cuts and bigger tax refunds, including inflation.
US Economic Outlook
The US economy could get a lift this year if President Trump appoints a new Federal Reserve chair more inclined to lower the central bank’s benchmark interest rate. However, inflation remains a concern, with the December CPI showing that prices rose at a 2.7% annualized rate.
Economic Growth and Inequality
Leading global economic policymakers have urged countries and businesses to focus on boosting growth and fighting inequality. The World Trade Organization head, Ngozi Okonjo-Iweala, emphasized the need for international cooperation and investment in education and training to address inequality.
Conclusion
The global economy is showing resilience despite the disruptions caused by the Trump administration. However, efforts are needed to boost growth, address inequality, and ensure that disruptive technologies like artificial intelligence do not worsen inequality or devastate labor markets.