- ORIGINAL NEWS
IMF upgrades global growth forecast as economy proves ‘surprisingly resilient’ despite downside risks
- SUMMARY
The International Monetary Fund (IMF) has revised its global growth forecast slightly upwards, indicating increased resilience in the global economy despite ongoing challenges.
The IMF now projects growth of 3.2% in 2024, a modest increase compared to its previous forecast.
Chief economist Pierre-Olivier Gourinchas believes that the findings point towards a “soft landing” for the global economy, despite several risks and uncertainties.
Key factors contributing to the growth include advanced economies recovering faster than expected and inflation slowing down.
However, China’s economic slowdown and geopolitical concerns, such as the ongoing war in Ukraine, could potentially dampen global trade.
The IMF cautions that prolonged high interest rates and trade tensions also pose risks to economic growth.
The IMF acknowledges that global headline inflation is expected to decline over the next few years, but remains elevated.
Central banks face the delicate task of managing inflation while maintaining economic stability.
The report highlights the importance of fiscal consolidation and sustainable debt management as central banks gradually reduce their restrictive monetary policies.
While the outlook has improved, global growth remains below historic levels due to low productivity and geopolitical fragmentation.
The IMF’s long-term forecast predicts global growth at 3.1% over the next five years, which is the lowest level in decades.
In summary, the IMF projects a slight improvement in global growth for 2024, but recognizes the presence of risks and uncertainties.
The economy shows resilience, but ongoing challenges require careful management by central banks and governments.
- NEWS SENTIMENT CHECK
- Overall sentiment:
positive
Positive
“The IMF now expects global growth of 3.2% in 2024, up by a modest 0.1 percentage point from its earlier January forecast.”
“The IMF’s chief economist, Pierre-Olivier Gourinchas, said the findings suggest that the global economy is heading for a “soft landing,” following a string of economic crises, and that the risks to the outlook were now broadly balanced.”
Negative
“China, whose economy remains weakened by a downturn in its property market, was cited among a series of potential downside risks facing the global economy.”
“But dimmer prospects in China and other large emerging market economies could weigh on global trade partners, the report said.”