IMF upgrades global economic outlook
WASHINGTON: Global economies are recovering simultaneously and at a stronger pace, and will get at least a short-term boost from the US tax cuts, the International Monetary Fund (IMF) said yesterday.
In the latest update to the IMF’s World Economic Outlook (WEO), nearly all the forecasts for 2018 and 2019 were revised upward compared to the October edition. However, the fund warns that exuberant financial markets could be due for a reversal.
The global economy is now expected to grow 3.9% this year and next, twotenths higher than the previous estimate, and up from 3.7% in 2017.
Advanced economies are seeing solid simultaneous growth, and the US tax reform passed just before Christmas will have a measurable effect, at least for a couple of years.
“The revision reflects increased global growth momentum and the expected impact of the recently approved US tax policy changes,” the IMF said.
“Some 120 economies, accounting for three quarters of world GDP, have seen a pickup in growth in year-on-year terms in 2017, the broadest synchronised global growth upsurge since 2010.”
The WEO upgraded the US GDP growth forecast by a surprising fourtenths of a point this year to 2.7%, compared to the expected 2.3% in 2017.
Japan saw a rare and large upgrade of five-tenths for this year to 1.2%. China saw a more modest improvement of just one-tenth to 6.6%. – AFP