Page 6 - Policy Economic Report_Jan 25

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Economy in Focus

1. A snapshot of the global economy

Global economic growth

According to IMF, global growth is projected at 3.3 percent both in 2025 and 2026, below the historical
(2000–19) average of 3.7 percent. The forecast for 2025 is broadly unchanged from that in the October
2024 IMF’s World Economic Outlook (WEO), primarily on account of an upward revision in the United
States offsetting downward revisions in other major economies.

? In the United States, underlying demand remains robust, reflecting strong wealth effects, a less
restrictive monetary policy stance, and supportive financial conditions. Growth is projected to be
at 2.7 percent in 2025.

? In the euro area, weaker-than-expected momentum at the end of 2024, especially in
manufacturing, and heightened political and policy uncertainty explain a downward revision of
0.2 % point to 1.0 percent in 2025. In 2026, growth is set to rise to 1.4 percent, helped by stronger
domestic demand, as financial conditions loosen, and confidence improves.

? Growth in 2025 for China is marginally revised upward by 0.1 % point to 4.6 percent. This revision
reflects carryover from 2024 and the fiscal package announced in November largely offsetting the
negative effect on investment from heightened trade policy uncertainty and property market.

Figure 1: GDP growth projections for 2025

Source- IMF

January 2025 Page | 5