IMF's Revised Outlook: Global Growth in Flux Amidst Emerging Risks
The International Monetary Fund (IMF) has reevaluated growth projections for China and the euro area, highlighting a global growth landscape characterized by sluggishness and inconsistency. Despite the robust performance of the US economy, the IMF cautioned that growth trajectories worldwide were diverging, with medium-term prospects appearing lackluster. The IMF also expressed concerns about risks linked to the real estate crisis in China, volatile commodity prices, geopolitical fragmentation, and the potential resurgence of inflation.
In the latest World Economic Outlook (WEO), the IMF held the forecast for global real GDP growth in 2023 steady at 3.0%, while marginally adjusting the 2024 projection down by 0.1 percentage point to 2.9% compared to the July estimate. Global output demonstrated a 3.5% increase in 2022.
Gourinchas observed that the forecasts generally pointed towards a gradual economic slowdown, underscoring the IMF's vigilance towards risks tied to the real estate crisis in China, fluctuating commodity prices, geopolitical tensions, and the potential reemergence of inflation.
Just as finance officials from 190 countries convened in Marrakech for the annual meetings of the International Monetary Fund and World Bank, an unforeseen risk arose in the form of the Israel-Palestinian conflict. This development followed the IMF's quarterly update, underscoring the ever-evolving nature of global economic challenges.
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