Global Inflation Forecast: Will prices come down in 2024?

Global inflation forecast- general observations.

In their recent research paper on Global Inflation Forecast, JPMorgan (2024) share their predictions for inflation around the globe for the coming year. Economists look at the global picture, then at specific regions. Generally, there is a downward trend across the globe. But, expectations are for a bumpy ride to achieve the lower inflation targets in the US, Europe and UK.

Impact on core goods and core services inflation

According to JPMorgan (2024), global inflation is expected to fall as the year progresses. China is the notable exception, where analysts are expecting a modest rise in core CPI. With robust labour markets and solid demand growth, this research examines the impact of these factors. Not just on core goods specifically, but also core services inflation.

global inflation forecast- US.

In the US, it is anticipated that a softening of the labour market may be required in the run-in to inflation targets. Consequently, it is more likely that energy prices will be impacted by geo-politics this year . Overall, U.S. policymakers will likely be focusing on core inflation measures in 2024. As a result, changes in food and energy prices could also be significant.

global inflation forecast- UK region

For the UK JPMorgan (2024) forecast core inflation to remain high in 2024. That is despite the recent decline from its double-digit peak. Headline inflation may fall to target levels in the 1st half of the year . This could apply pressure for policy -makers to cut interest rates earlier than planned. Core inflation is expected to remain elevated in 2024, reaching 3.1% in both June and December. As with the U.S., the persistence of inflation in the U.K. is largely due to services prices.

regional analysis- eurozone

The bumpy road to target inflation is also a feature for the Eurozone. However, JPMorgan (2024) forecasts that the challenging growth outlook in the region will be a key factor in achieving the 2% target. However, the fact that the growth outlook for the region is challenging makes a full disinflation back to the ECB’s 2% target more likely.

Read the full article on the pdf below or download here.

JP-Morgan-Inflation-Research-Feb-2024-V2

Subscribe to our Updates