Fitch Ratings reports strong start for global economy in Q1 2023
The global economy is off to a robust start in 2023, exceeding expectations in some key areas, according to the latest report from Fitch Ratings. The firm’s ’20/20 Vision’ report provides an overview of 20 major economies, analyzing five years of high-frequency data across 20 variables.
The results for the first quarter of 2023 show that the eurozone countries have exceeded expectations, with Italy and Spain posting gains of 0.5% and France gaining 0.2%. Meanwhile, the US posted headline growth of 0.3% quarter-on-quarter, slightly below Fitch’s forecast of 0.4%, but still showing strong consumption and a pickup in exports.
One of the main drivers of the better-than-expected results is the reopening of China’s economy, which saw a 2.2% quarter-on-quarter growth, beating Fitch’s forecast of 1.4%. This was driven by a strong rebound in both exports and consumption, as Covid-19 restrictions were lifted and property sales stabilized. The US and eurozone economies also saw strong consumer spending, with the US posting a half-percent increase in the fourth quarter of 2022.
Fitch’s report also notes that a significant easing of the natural gas crisis in Europe helped contribute to the better-than-expected results. However, the report cautions that there are still some challenges ahead, particularly with regard to investment. The US posted its fourth consecutive quarterly decline in investment, and falling inventories also contributed to slower growth. Meanwhile, Germany saw zero growth after a quarterly contraction of 0.5% in the fourth quarter of 2022.
Despite some challenges, Fitch’s report paints a positive picture for the global economy in the first quarter of 2023. The ’20/20 Vision’ report provides an in-depth analysis of the major economies, with consistent coverage across each country, making it a valuable tool for investors and analysts alike. As the year progresses, it will be interesting to see how these trends evolve and whether the global economy can maintain its momentum.
