The Global Economy Is Slowing, New IMF Report Shows

Vanessa Conneely - 10th April 2019

IMF Chief Economist Gita Gopinath described the forecast as "precarious".

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The International Monetary Fund has released its global outlook for next year, which features a downward revision compared to the previous forecast.

In its World Economic Outlook, the IMF says forecasts show a global growth of 3.3 per cent is expected this year, with a rise to 3.6 per cent in 2020.

While this still shows a gain, it is a downgrade of 0.2 percentage points when compared with the previous forecast.

Commenting on the news, IMF Chief Economist Gita Gopinath says the global economy is at a “delicate moment" and while she doesn’t predict a global recession, “there are many downside risks".

The US, the UK and the Eurozone are among the developed economies affected, with Brexit and the tension between the Trump administration and Brussels over tariffs adding to the uncertainty.

The UK economy is predicted to grow by 1.2 per cent in 2019, down 0.3 per cent from the IMF forecast in January. Growth in 2020 has also been revised down.

Predictions for the German and Italian economies have also been revised down, which will make it even more difficult for Italy to recover from its ongoing recession.

The forecast also shows a slowdown in the latter part of 2018, which the IMF expects to continue in the first half of this year.

After that, growth should pick up more pace and continue into next year. But Ms Gopinath still describes the recovery as "precarious".

The IMF expects weaker performance in Latin America, as well as in the Middle East and North Africa.

For China, there are small revisions, upward for this year and downward for next. The slowdown there, which began at the start of the decade, is expected to continue.

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