Economy

International Monetary Fund forecasts 7.1% economic growth for 2019

International Monetary Fund forecasts 7.1% economic growth for 2019”

"I am now off to Bali for the annual IMF/World Bank meeting to continue dialogue with our global partners, focusing on accelerating Zimbabwe arrears with multi-lateral lenders and unlocking new capital", he said in a tweet yesterday. It was the first downgrade since July 2016.

It also slashed its outlook this year for 19 countries, including several eurozone member states and emerging markets. On Monday, the currency was trading at 128 per USA dollar on the open market and 124.20 in the official interbank rate.

"There are clouds on the horizon".

"We have not been formally approached yet", said Maurice Obstfeld, the IMF's top economist, during the fund's annual meeting in Bali. German growth was revised down to 1.9 percent in both 2018 and 2019 due to a slowdown in exports and industrial production.

Addressing a news conference at the International Monetary Fund and World Bank annual meetings in Bali, the IMF's Maurice Obstfeld cautioned that increased Chinese involvement in Pakistan's economy could bring both benefits and risks. It called for a tightening of monetary policy, a move the Reserve Bank of India did not take when it kept interest rates unchanged last week. However, the RBI pegged India's growth projections at 7.5 per cent.

The UK economy is expected to grow by 1.4% this year - down from April's prediction of 1.6% - while predicted growth for 2019 remains at 1.5%, a slowdown from 1.7% in 2017.

The IMF's cut to its outlook was broad-based.

President Donald Trump has slapped tariffs on US$250 billion in Chinese goods this year, and Beijing has retaliated with levies US$110 billion of American products.

"IMF's downgrade just goes to show how the tariff dispute between USA and China is beginning to take its toll on the global economy", said Peter Cardillo, chief market economist at Spartan Capital Securities in NY.

The IMF also predicted that Bangladesh's consumer prices would reach 5.8 percent at the end of this year and 6.1 percent next year.

"Nigeria's growth, 1.9 percent this year; 2.3 next year".

The IMF maintained a previous forecast for growth of 6.6 per cent for 2018. Core inflation, which excludes volatile items such as energy, will vary from country to country, it said. -China tariff war's impact to be felt next year, the Fund cut its 2019 USA growth forecast to 2.5 percent from 2.7 percent previously, while it cut China's 2019 growth forecast to 6.2 percent from 6.4 percent.

The Fund noted that economic growth appears to have peaked in some major economies while the gap between advanced countries and emerging markets was widening.

Global growth will slow to 3.6 per cent by 2022-2023, as growth in rich nations falls back to potential, it said.

The IMF said higher trade barriers could disrupt global supply chains, slow the spread of technology and ultimately lower global productivity and welfare. "Inclusive fiscal policies, educationalinvestments, and ensuring access to adequate health care can reduce inequality and are key priorities", he said.



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