World Bank lowers 2023 global growth forecast to 1.7% from 3% in June

The World Bank announced on Tuesday that it expects the global economy to grow by 1.7% in 2023, down sharply from 3% in June's forecast, as reported by Reuters.

Key takeaways

"World Bank forecasts US 2023 GDP growth at 0.5% vs 2.2% in June forecast; weakest non-recession performance since 1970."

"Growth outlook dimmed by effects of monetary tightening, slowdowns in US, Eurozone, China and Ukraine war spillovers."

"World Bank sees Eurozone GDP flat in 2023 vs 1.9% growth in June forecast due to soaring energy costs, rising borrowing costs."

"Investment in emerging market and developing economies projected to grow at 3.5% pace through 2024, half the pace of previous two decades."

"China's 2022 growth slowed to 2.7% due to COVID lockdowns but will recover to 4.3% for 2023."

Market reaction

This headline doesn't seem to be having a noticeable impact on risk sentiment. As of writing, the S&P 500 Index was virtually unchanged on the day at 3,890.