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IMF cuts global growth forecast to the lowest level since the financial crisis

Steel News - Published on Mon, 15 Apr 2019

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The International Monetary Fund in its latest World Economic Outlook , for the third time in six months, has cut its global growth forecast to the lowest level since the financial crisis, warning of significant downside risks to the world economy including trade tensions, pockets of political instability, mounting debt levels and increasing inequality. IMF lowered its global growth forecast for 2019 to 3.3% from the previous level of 3.5%. IMF warned the outlook for many countries is still challenging given the potential for trade disputes to flare up. The IMF also cautioned growth in China may surprise on the downside and that the risks from Brexit remain heightened. In India, growth is projected to pick up to 7.3% in 2019 and 7.5% in 2020, supported by the continued recovery of investment and robust consumption amid a more expansionary stance of monetary policy and some expected impetus from fiscal policy. Nevertheless, reflecting the recent revision to the national account statistics that indicated somewhat softer underlying momentum, growth forecasts have been revised downward compared with the October 2018 WEO by 0.1 percentage point for 2019 and 0.2 percentage point for 2020, respectively.

Overview of the World Economic Outlook Projections
(Percent chance, unless noted otherwise)
Heading2018201920202019 Change2020 Change
World Output3.63.33.6-0.20.0
Advanced Economies2.21.81.7-0.20.0
United States2.92.31.9-0.20.1
Euro Area1.81.31.5-0.3-0.2
Germany1.50.81.4-0.5-0.2
France1.51.31.4-0.2-0.2
Italy0.90.10.9-0.50.0
Spain2.52.11.9-0.10.0
Japan0.81.00.5-0.10.0
United Kingdom1.41.21.4-0.3-0.2
Canada1.81.51.9-0.40.0
Other Advanced Economies22.62.22.5-0.30.0
Emerging Market and Developing Economies4.54.44.8-0.1-0.1
Commonwealth ot Independent States2.82.22.30.00.0
Russia2.31.61.70.00.0
Excluding Russia3.93.53.7-0.20.0
Emerging and Developing Asia6.46.36.30.0-0.1
China6.66.36.10.1-0.1
India37.17.37.5-0.2-0.2
ASEAN-545.25.15.20.00.0
Emerging and Developing Europe3.60.82.80.10.4
Latin America and the Caribbean1.01.42.4-0.6-0.1
Brazil1.12.12.5-0.40.3
Mexico2.01.61.9-0.5-0.3
Middle East. North Atrica. Afghanistan, and Pakistan1.81.53.2-0.90.2
Saudi Arabia2.21.82.10.00.0
Sub-Saharan Africa3.03.53.70.00.1
Nigeria1.92.12.50.10.3
South Africa0.81.21.5-0.2-0.2
 

1. Difference based on rounded figures for the current January 2019 World Economic Outlook Update
2. Exdudes the Grap of Seven (Canada France, Germany, Italy, Japan, United Kngdcm, United Stales) and euro area countries
3. For Inhdiada and forecasts are presented on a fiscal year basis and GOP from 2011 onward is based on GDP at market prioes with fiscal year 2011/12 as a base year
4. Indonesia, Malaysia, Phillippnes, Thailand, Vietnam

Despite the lowered forecast for 2019, the IMF expects the global economy to pick up in the second half of this year, thanks to more growth-friendly policies from central banks. It also left its forecast for 2020 unchanged at 3.6% predicated on a rebound in Argentina and Turkey, along with an improvement in other stressed emerging markets and developing economies. Beyond 2020, the IMF predicts that global growth will stabilise at around 3.5%, buoyed mainly by growth in China and India.

Source :

Posted By : Rabi Wangkhem on Mon, 15 Apr 2019
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