MORGAN STANLEY'S GLOBAL ECONOMIC OUTLOOK

• Both global growth as well as global inflation is likely to moderate through 2023 and 2024
• Some of the wealthiest countries in the world are in for a tough time. The G10 countries are likely to witness rather anaemic growth rates
• The G10 grouping refers to, oddly enough, 11 industrialised countries
• The member countries are Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland, the United Kingdom, and the United States
• As the names suggest, the G10 refers to some of the wealthiest countries (in per capita income terms) in the world.
• China, on the other hand, is expected to progressively recover its growth momentum
• Even so, it is unlikely to challenge India in terms of GDP growth rates. Readers should, however, remember that the Chinese economy is almost five-times India’s size (in terms of GDP)
•  So when China grows at 5% in a year, it adds $1 trillion to its GDP, which is already around $20 trillion
• To match the same level of additional GDP, India will have to grow at more than 25% because India’s existing GDP base is less than $4 trillion.
• On the inflation front, it looks like US inflation is likely to come fairly close to the US central bank target of 2% by the end of 2023
• This would be good news because the US central bank actions tend to have an oversized impact on economies across the world including India
•  If inflation is under control in the US, India can look forward to a more stable interest rate scenario, which, in turn, will help business plan and invest