The International Monetary Fund has raised its growth forecast for the world's leading economies
The International Monetary Fund on Tuesday released its latest global economic outlook, revising its forecast for U.S. economic growth upward while predicting a slowdown in eurozone growth.
The IMF raised its forecast for US economic growth this year by 0.3 percentage points from its July forecast to 2.1%. He raised his forecast for next year by 0.5 percentage points, to 1.5%.
Eurozone growth forecasts for 2023 were revised down by 0.2 percentage points to 0.7%, and for 2024 by 0.3 percentage points to 1.2%.
The IMF attributed the rise to the US rating upgrade, stronger business investment in the second quarter, robust consumption growth amid a tight labor market and the government's expansionary fiscal policy. However, growth is expected to slow in the second half of 2023 and into 2024, he added, due to slowing wage growth, pandemic-related savings declines, tight monetary policy and rising unemployment.
In the eurozone, the IMF this year noted a divergence between the countries' largest economies: Germany's economy is expected to contract as trade slows and interest rate growth slows, as external demand in France has outpaced industrial output growth and industrial production has caught up.
The UK's growth forecast was raised slightly to 0.5% for 2023, but cut by 0.4 percentage points to 0.6% for 2024 as it expected "lingering effects of the terms of trade shock caused by high energy prices" .
The IMF reaffirmed its forecast for global growth at 3% this year and raised its forecast for 2024 by 0.1 percentage point to 2.9%.
"Some headwinds to global growth eased earlier this year," the IMF said in a forecast, as the World Health Organization said Covid-19 was no longer a global health emergency, supply chains had largely normalized and global financial conditions improved after turbulence in Switzerland and Switzerland. The US banking sector was subdued.
However, challenges remain, he continued, notably a slowdown in manufacturing, a slow underperformance of services in some areas and a "globally synchronized" tightening of central bank policies to cool inflation.
China's growth rate is weakening after a strict lockdown as the country also faces a real estate crisis, according to the IMF. The IMF expects China's economy to grow 5% this year and 4.2% next year.