Semestrial Panorama 2024 #2

2024 was supposed to be a year of rate cuts, ending with a question mark over the US elections which would reopen the scenarios for 2025… Yet, firstly, inflation is struggling to leave the stage and give way to widespread and significcant rate cuts.Secondly, political factors already seem to be gaining the upper hand by bringing about fresh uncertainty over the path of the global economy in the short and medium term.While oil prices display good resistance (with an upward trend) to the tensions in the Middle East, and grain prices seem to be returning to the levels that prevailed before the war in Ukraine, the continuation and/or extension of the conflicts could permanently change certain supply chains and certain commodity markets. The first consequence would be volatile and structurally higher inflation, potentially driven by an acceleration and intensification of climatic disasters. Finally, the reconstitution of rival blocs could adversely affect trade, financial, and migration flows, which had reduced inequalities and increased productivity across the globe.For this reason, in this latest edition in the MacroDev Semestrial Panorama series, we have decided to put the spotlight on the path of foreign direct investment (FDI), which stands as both a weak signal of the geoeconomic reconfiguration and a fundamental element of the sustainability of external accounts, development, and the economic convergence of emerging and developing countries.