IMF leaves global GDP forecasts for 2017, 2018 unchanged after US elections
The global economy was set to accelerate over the next two years but there were uncertainties around exactly what policies the US would put in place and several emerging market economies were now seen growing more slowly, the International Monetary Fund said.
In an update of its October 2016 World Economic Outlook forecasts, the IMF said global gross domestic product would expand at a 3.4% clip in 2017 and by 3.6% in 2018, which was unchanged from its prior projections.
The new set of forecasts included assumptions for a changed policy mix in the States and a higher price of oil, the Fund said.
However, advanced economies were now seen expanding slightly more quickly and emerging ones, where financial conditions have generally tightened, a tad more slowly.
Among the former, the IMF now expected saw the US growing at a pace of 2.5% in 2018, which was four tenths of a percentage point more than previously expected.
In parallel, the UK was seen growing 1.4% in that year, versus a prior forecast of 1.7%. That was more than offset by an upwards revision to the IMF’s 2017 projection from 1.1% to 1.5%.
Italy on the other hand was now seen growing less in both 2017 and 2018, by 0.7% and 0.8%, respectively, instead of by 0.9% and 1.1%.
Emerging market and developing economies would grow by 4.5% and 4.8% over those same two year, with the former being one tenth of a percentage point less than previously anticipated.
Growth expectations for the Asean-5 and India in 2017 were marked down, as well as those for Latin America and the Caribbean and the Middle East for both years.
Saudi Arabia fared particularly poorly, with the Fund’s economists’ new forecasts calling for an expansion of 0.4% and 2.3%, which were 1.6 and 0.3 percentage points than the IMF said in October.
At 0.2%, Brazil’s economy was now seen expanding 0.3 percentage points less quickly in 2017.
Mexico would also grow 0.6 percentage points less in both years, with GDP increasing 1.7% and 2.0%.
On a more positive note, the forecast for Chinese GDO growth in 2017 was revised from 6.2% to 6.5%.
Despite its markdown for India, the Subcontinent was still seen clocking in with growth of 7.2% and 7.7% over the same time horizon.