Analyzing the Economic Results for the Third Quarter of 2024

So far, the economic results from the third quarter of 2024 have been relatively reassuring, even as some of the key risk factors that have been impacting the global economy in recent years have stubbornly remained in place. Nevertheless, economic growth remains concentrated in a handful of countries and a select number of industries, fueling concern about the overall health of the economy among policymakers and the public at-large.

Here are how some of the world’s key economies performed in the third quarter of this year:

UNITED STATES

The United States continued to grow faster than nearly all other developed economies, with the US economy growing by 2.7% on a year-on-year basis in the third quarter. Once again, it was US consumers that continued to drive growth in the world’s largest economy, as did the US economy’s strong position in key growth sectors such as high-tech and energy. On the downside, inflationary pressures have remained in place and could worsen if the incoming Trump Administration enacts widespread tariffs and the expulsion of millions of undocumented migrants.

EUROPE

Economic growth across Europe remained muted, with the Eurozone economy expanding by just 0.9% on a year-on-year basis in the third quarter, while the economy of the United Kingdom grew by 1.0%. Large economies such as Germany and France continued to struggle due to their waning competitiveness in many key sectors, with growth being more concentrated in southern and central Europe. Now, fears of a global trade war and Europe’s lack of a presence in many high-growth sectors of the economy are threatening to prolong the region’s recent economic malaise.

ASIA

There was a mixed-bag of economic results from Asia in the third quarter of 2024. Growth slowed further in China in the third quarter, falling to 4.6% on a year-on-year basis and once again failing to meet Beijing’s 5% growth target. Japan’s economy also remained mired in a slump, with the world’s fourth-largest economy growing by just 0.3%. South Korea’s economy also slowed in the third quarter, with 1.5% growth during that period. As Asia’s largest economies continue to slow, more of the region’s economic growth will be concentrated in South and Southeast Asia, which are home to some of the world’s fastest-growing economies.

ELSEWHERE

There were very mixed results from economies in other parts of the world in the third quarter of 2024. In Latin America, Brazil’s economy showed increasing signs of life as it expanded by 3.3% on a year-on-year basis. However, growth in Mexico and most other larger Latin American economies was once again subdued during that period. In oil producing countries in the Middle East, growth slowly rebounded from the earlier slump caused by lower oil revenues. Overall, few regions outside of the main global economic centers have grown fast enough to have a major impact on the global economy so far, but this will play a crucial role in the long-term health of the global economy.

WHAT THIS MEANS

Overall, the global economy is forecast to grow by 3.1% this year, almost the same as in 2023, but more than 10% slower than in the years before the Covid-19 pandemic. Moreover, without major increases in productivity growth, the global economy is likely to continue to record slightly slower rates of growth in the years ahead. Add to this the threats posed by rising geopolitical tensions, lingering inflation and worsening labor shortages, and it is clear that the global economy will need to find new sources of growth in the future. Perhaps AI and other technologies will provide the spark to productivity that is needed to generate higher rates of global economic growth?

IMPLICATIONS FOR YOU

The challenge of finding opportunities for growth, while mitigating the impact of these aforementioned risks, will be a major task for your business in the months and years ahead. With growth concentrated in a handful of economies and industries, choosing the right markets and industries to expand your presence in will be crucial for your future success.