Gita Gopinath, the IMF’s Chief Economist/Bloomberg

Business Economy

IMF cuts global growth outlook to lowest pace since 2009

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The International Monetary Fund (IMF) has warned that risks are skewed to the downside, with the possible collapse of negotiations between the US and China to end their trade war and a no-deal Brexit scenario.

Wednesday 10, April 2019

(Bloomberg) --The IMF has reduced its outlook for global growth to the lowest since the financial crisis amid a bleaker outlook in most major advanced economies and signs that higher tariffs are weighing on trade.

In its latest World Economic Outlook report, the IMF said that the world economy will grow 3.3 per cent this year, down from the 3.5 per cent the it had projected for 2019 in January.

The 2019 growth rate would be the weakest since 2009, when the world economy shrank and it is the third time the IMF has downgraded its outlook in six months.

Gita Gopinath, IMF’s Chief Economist, said, “This is a delicate moment for the global economy, a projected pickup in growth next year is precarious.”

The global volume of trade in goods and services will increase 3.4 per cent this year, weaker than the 3.8 per cent gain in 2018 but reduced from the IMF’s January estimate of four per cent.

Global economic growth will recover in the second half of this year, before plateauing at 3.6 per cent from next year, according to the Washington-based fund.

A series of encouraging developments have boosted optimism about the world economy in recent weeks, including the decision of the Federal Reserve to put interest-rate hikes on hold and encouraging data from China’s manufacturing sector and the US job market.

IMF Managing Director Christine Lagarde is warning that the world economy faces a delicate moment as finance ministers and central bankers prepare to gather in the US capital this week for the spring meetings of the IMF and World Bank.

TAGS : IMF, global growth outlook, US-China Trade war, NO-DEAL BREXIT

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