China, India forecast to lead 5.4 per cent global GDP rebound in 2021, but vaccine roll-out crucial: Moody’s

Moody’s Analytics expects the global economy to grow by 5.4 per cent in 2021, upgrading its February forecast of 4.9 per cent

However, the estimate is predicated on a successful vaccine roll-out, with herd immunity unlikely to occur before mid-2024

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Moody’s Analytics expects the global economy to grow by 5.4 per cent in 2021. Photo: Getty Images

Published: 6:30pm, 23 Mar 2021Updated: 9:06am, 24 Mar 2021

The world economy is expected to grow by more than 5 per cent this year, but the recovery is dependent on a successful roll-out of Covid-19 vaccines across the globe, according to a new analysis.

Global gross domestic product (GDP) contracted a historic 3.7 per cent last year due to the impact of the coronavirus pandemic, but Moody’s Analytics has forecast a rebound of 5.4 per cent in 2021, upgrading its February estimate of 4.9 per cent.

Asia is expected to lead the recovery with growth of 6.9 per cent, fuelled by China’s rapid expansion and India’s turnaround.

However, the forecast is predicated on a successful global vaccine roll-out, Moody’s Analytics economist Shahana Mukherjee said.

Recovery will continue to be uneven across regions until cases across the world begin to subside and vaccine distribution picks up

Shahana Mukherjee

“Our slightly upgraded outlook is based on recovering global trade, the passage of new fiscal stimulus in the US and in some parts of Europe, and some improvement in the global vaccination momentum,” Mukherjee said.