In 2021, the US real GDP grew at a rate of 5.7% over the previous year and became an $18,666 billion economy
China is one of the fastest-growing economies in the world, with an annual real GDP growth rate of 8%
COVID-19, the Russia-Ukraine war, and rising inflation have caused a slowdown in the global economic growth
Outlook on Global Economy Growth
Real GDP growth is GDP’s annual percentage growth rate at market prices based on constant local currency.
The US, China, Japan, Germany, and India are the world's top five economies in terms of real GDP. The US is the largest economy in the world, followed by China. China is one of the fastest-growing economies in the world, with an annual real GDP growth rate of 8%; it grew at a CAGR of 7% between 2010 and 2021. In 2021, India’s annual real GDP growth rate was 9% and grew at a CAGR of 5% between 2010 and 2021.
Overview of the US Real GDP Growth
In 2021, the US real GDP grew at a rate of 5.7% over the previous year and became an $18.7 trillion economy. The US real GDP grew at a CAGR of 2.0% between 2010 and 2021. However, an increase in COVID-19 cases, rising inflation, and conflict between Russia and Ukraine dimmed the US growth outlook.
Factors Affecting the Global Economy
A rise in COVID-19 cases:
As a result of Omicron, a new variant of COVID-19, more cases have been reported worldwide, resulting in the disruption of supply chain management. However, the global vaccination drive has reduced the fatality rate from the coronavirus.
Russia-Ukraine war:
A prolonged conflict between Russia and Ukraine will continue to affect global economic growth. Investment and trade have been adversely affected due to the war as economic sanctions have been imposed on Russia, and several big companies have stopped their operations in the country.
Rising Inflation and Interest Rates:
As a result of rising inflation rates in both developing and advanced economies, central banks have been forced to tighten monetary policy and raise interest rates to keep prices from rising. However, a steady increase in interest rates could cause financial distress in some economies.
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