Global Economy: Risks, Resilience & Outlook 2024

Despite ongoing geopolitical tensions and anxieties about economic slowdowns, the global economy appears surprisingly resilient, fueled by a notable upswing in credit availability. This isn’t to say challenges don’t exist – recent surges in gasoline prices, for example, are raising concerns – but broad indicators suggest a more robust economic landscape than many headlines suggest. The question now is whether this credit-driven momentum can overcome persistent headwinds like trade uncertainty and regional conflicts.

Credit Expansion Defies Gloom

A key factor underpinning this resilience is the accelerating pace of loan growth across major developed economies. According to Fisher Investments, banks in the US, UK, eurozone, and Japan are lending at their fastest rates in several years. This surge in credit isn’t limited to specific sectors; both households and businesses are accessing loans, indicating a willingness to spend and invest. This trend directly contradicts widespread worries about economic retrenchment. As of March 3, 2026, data from the Federal Reserve Bank of St. Louis, Bank of England, European Central Bank, and FactSet show this accelerating lending.

The willingness of banks to extend credit is further supported by upward-sloping yield curves in developed economies. In other words long-term interest rates are comfortably above short-term rates, creating a profitable margin for banks and incentivizing further lending. This dynamic suggests a healthy appetite for risk and a positive outlook on future economic growth.

Pain at the Pump, Limited Impact

Recent increases in gasoline prices, triggered by conflict in the Middle East, have understandably sparked concerns about their potential impact on the global economy. As of March 10, 2026, the national average for a gallon of regular gasoline in the US had risen to $3.54, an increase of 43 cents in a week and 62 cents in a month. Similar price hikes are being observed globally, with Germany seeing diesel prices exceeding €2 per liter (approximately $8.50 per gallon) and the UK experiencing a nearly 5 pence per liter increase.

However, Fisher Investments argues that even as higher gas prices are annoying for consumers, their macroeconomic impact is limited. Seasonal factors, such as the transition to summer gasoline blends and temporary refinery outages due to weather events, also contribute to price fluctuations. The primary driver remains global crude oil prices, which jumped in anticipation of and following the Middle East conflict. The firm contends that gasoline prices don’t necessarily dictate stock performance.

Emerging Markets Show Strength

Beyond developed economies, domestic demand in several Emerging Market nations is proving to be a significant, and often underappreciated, source of growth. Brazil and Mexico, despite facing trade-related uncertainties, have demonstrated resilience in their domestic economies. Brazil’s Q3 GDP rose 0.1% quarter-over-quarter, with the services sector expanding by the same amount. Mexico’s economy contracted slightly in Q3, but the overall picture remains positive. Fisher Investments highlights that strong commodity production, particularly in agriculture, is bolstering economic activity in these regions.

The Credit Cycle and Global Commerce

The current credit expansion isn’t an isolated event; it’s part of a broader credit cycle. The availability of credit is often seen as the “lifeblood” of the economy, and its flow directly impacts investment, consumption, and overall economic growth. The fact that credit is flowing “liberally” to both households and businesses suggests a positive feedback loop, where increased lending fuels economic activity, which in turn encourages further lending. This dynamic is particularly noteworthy given the prevailing narrative of economic weakness. Fisher Investments emphasizes that focusing on lagging indicators can obscure these crucial leading signals.

Implications for Investors and Businesses

The combination of accelerating credit growth, resilient emerging market demand, and a limited macroeconomic impact from higher gasoline prices paints a cautiously optimistic picture for the global economy. This doesn’t signify the path forward is without risks. Geopolitical tensions, trade uncertainties, and the potential for unforeseen disruptions remain significant concerns. However, the underlying economic fundamentals appear stronger than many anticipate.

For investors, this suggests potential opportunities in global equities. The credit-fueled economic expansion could support corporate earnings growth, while resilient emerging market demand provides an additional source of growth. Businesses, particularly those reliant on credit or operating in emerging markets, should closely monitor these trends and adjust their strategies accordingly.

Navigating the Risks

While the current economic outlook is relatively positive, several risks warrant attention. The ongoing conflict in the Middle East could escalate, leading to further disruptions in oil supply and potentially triggering a broader economic downturn. Trade tensions between major economies remain a persistent threat, and any escalation could negatively impact global commerce. The potential for unexpected shocks, such as a new wave of COVID-19 or a major cyberattack, cannot be ruled out. The Economist details these risks in a recent report.

Businesses should prioritize risk management and diversification. Maintaining strong balance sheets, diversifying supply chains, and investing in cybersecurity are crucial steps to mitigate potential disruptions. Investors should consider diversifying their portfolios across asset classes and geographies to reduce their exposure to specific risks.

Looking ahead, monitoring credit trends will be paramount. A slowdown in loan growth could signal a weakening economy, while continued expansion suggests sustained momentum. Tracking developments in emerging markets and assessing the impact of geopolitical events will also be critical. The interplay between these factors will ultimately determine the trajectory of the global economy in the coming months.