In a report released on Tuesday, the International Monetary Fund maintained its forecast for global growth in 2024 but issued a warning about impending trade tensions and inflation risks.
The IMF raised its economic outlook for China, India, and Europe but lowered its predictions for the US and Japan in 2024. The fund has not changed its April forecast and now projects a meager 3.2% growth in the global economy this year and a 3.3% growth in 2025.
The IMF’s World Economic Outlook update states that stickier-than-expected inflation for services, such as dining out and airline travel, has slowed global progress against accelerating prices.
The IMF’s chief economist, Pierre-Olivier Gourinchas, stated at a press briefing that “global growth remains steady.” Nevertheless, by recent historical standards, the global economy’s expansion is still not impressive. Before the pandemic upended economic activity in 2019, global growth had averaged 3.8% annually from 2000 to 2019.
According to Gourinchas, China and India will contribute almost half of this year’s global growth. The IMF raised its growth estimate for China this year to 5.0 percent from the 4.6 percent it had predicted in April, though it was still lower than its 2023 estimate of 5.2 percent, in part due to a spike in Chinese exports at the beginning of 2024.
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