A McKinsey Global Survey finds that concern over high interest rates has almost halved from earlier in 2023. In November and December just 18 percent of respondents cited inflation as a risk to growth, compared with 34 percent in March. Senior partner Sven Smit and colleagues note that while central banks in developed countries responded to the easing of inflation concerns by holding rates steady, Brazil cut rates and Russia raised them.
Image description:
A series of 7 area graphs shows the monthly central-bank interest rates of 7 developed or developing economies (Brazil, China, eurozone, India, Russia, UK, and US) from Jan 2007 to Dec 2023. The rates for China, eurozone, UK, and US are ~5%, while the rates for Brazil and Russia are more than double that rate, with India somewhere in between.
Source: Banco Central do Brasil; Bank of England; Central Bank of Russia (CBR); European Central Bank (ECB); New York Fed; Reserve Bank of India; McKinsey Global Economics Intelligence analysis.
End of image description.
To read the article, see “Global Economics Intelligence executive summary, December 2023,” January 22, 2024.