Global economy will grow 3% this year, IMF projects
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Natalie Peeples/Axios
The good news is that the global economy has proven resilient to the shocks of the pandemic, high inflation and war in Ukraine. The bad news is that it is only limping along, the International Monetary Fund says.
Driving the news: The latest installment of the IMF's World Economic Outlook projects the global economy will grow 3% this year, down from 3.5% last year.
- Still, its forecast is for inflation to continue receding without a global recession. The report notes that the "projections are increasingly consistent with a soft landing scenario," especially in the United States.
- The fund's economists see a slew of risks ahead, including troubles triggered by Chinese real estate and volatile commodity prices.
What they're saying: "Despite the disruption in energy and food markets caused by the war, and the unprecedented tightening of global monetary conditions to combat decades-high inflation, the global economy has slowed, but not stalled," the report said.
- "Yet growth remains slow and uneven, with growing global divergences," the economists write. "The global economy is limping along, not sprinting."
Yes, but: The projections were prepared before Hamas' attack on Israel over the weekend created the risk of new geopolitical turbulence in the Middle East.
- Asked about the potential economic impact, IMF chief economist Pierre-Olivier Gourinchas said it was too soon to draw conclusions. "I think we have to be cautious," he said in a news conference. "I think it's too early to really assess what the impact might be."
- "Of course we all hope for a rapid de-escalation and an end to violence," he added.
