Analysts at American multinational investment bank Citigroup have raised their global growth forecast and are predicting a ‘less hard’ landing for the economy in 2023.

It is now expected that global growth will slow to around 2.2 per cent. This is 0.25 per cent higher than the bank had previously estimated, with the Nathan Sheets-led economists noting improving macroeconomic trends as cause for optimism.

The bank also said that China’s stronger economic outlook will help to offset stagnation in the euro area, but warned that high inflation may temper growth.

In his note, Sheets said: "By our reckoning, global headline inflation is still running somewhere in the six-to-seven per cent range, well above central bank targets.”

Citigroup also said that it expects the US Federal Reserve to increase rates three times this year to beyond five per cent. "It appears that 2023 will be the year when the effects of that hiking cycle more fully play through," Citigroup said.

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