IMF lowers global growth forecast

The International Monetary Fund is lowering its global growth forecast as it predicts the global economy will grow more slowly due to the war in Ukraine and persistently high inflation.

In its forecast, the IMF expects global growth of 3.2 per cent this year, 0.4 percentage points less than expected in April.

For the Eurozone, the IMF expects growth to be 0.2 percentage points lower than forecast in April, at 2.6 per cent.

"The war in Ukraine could lead to a sudden stop of European gas imports from Russia; inflation could be harder to bring down than anticipated either if labour markets are tighter than expected or inflation expectations unanchor," the IMF said in its report.

This year, the IMF expects an inflation rate of 6.6 per cent in the industrialised countries and 9.5 per cent in emerging markets, upward revisions of 0.9 and 0.8 percentage point, respectively.

In the United States, the economy growth was revised down to 2.3 per cent amid lower growth earlier this year, reduced household purchasing power and tighter monetary policy.

In China, the renewed COVID-19 outbreaks and lockdowns as well as a further escalation of the property sector crisis might further suppress the country's growth, revised down by 1.1 percentage points to 3.3 per cent, with major global spill-overs.

Austrlaian Associated PressBack to Breaking News

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