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Nick Beams – IMF cuts growth forecasts for major economies

The International Monetary Fund has revised down its estimates for the US and other advanced economies for this year while maintaining its forecast for global growth as a whole at the low level of 3.1 percent in its latest World Economic Outlook report released yesterday.

It said the major economies would grow by just 1.6 percent this year compared to 2.1 percent in 2015, down from the forecast of 1.8 percent growth made last July. The most significant decline in the US where the IMF cut its July forecast of 2.2 percent growth to just 1.6 percent following what it said was a “disappointing first half caused by weak business investment” and a rundown of inventories.

It said the euro area would expand 1.7 percent this year and 1.5 percent next year compared to 2 percent growth in 2015. Growth in Japan, the world’s third largest economy, would be only 0.5 percent this year and 0.6 percent in 2017. Growth in the UK economy is forecast to be 1.8 percent this year, falling to 1.1 percent in 2017, compared to growth to 2.2 percent in 2015.

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