21 Jan 2014
IMF hikes global growth forecast
FXstreet.com (Łódź) - The International Monetary Fund released its updated World Economic Outlook on Tuesday, in which it indicated that global growth would pick up speed in 2014, but that the recovery would remain fragile.
The IMF rose the global growth forecast from 3.6% seen in October to 3.7%. It urged advanced economies to maintain accommodative monetary policies in order to boost the slow growth.
According to the IMF Chief Economist Olivier Blanchard: “The brakes to the recovery are progressively being loosened. The drag from fiscal consolidation is diminishing. The financial system is slowly healing. Uncertainty is decreasing.”
The UK GDP forecast was raised significantly from 1.9% to 2.4%, which confirmed yesterday´s reports. As far as the Eurozone is concerned, the IMF saw it growing by 1% this year. Blanchard emphasized that the recovery in the area was weak and uneven and urged the ECB to reduce its financial fragmentation as soon as possible. He also pointed to a 10-12% deflation risk in the Eurozone.
The growth outlook for the US was raised to 2.8% from 2.6%. The IMF Chief Economist said that the Fed policy framework and timing were reasonable and that he did not expect the FOMC to withdraw stimulus too soon.
Furthermore the IMF rose its 2014 growth forecast for Japan to 1.7% from 1.2% seen previously. It also projected that the Chinese economy would expand by 7.5% this year.
The IMF rose the global growth forecast from 3.6% seen in October to 3.7%. It urged advanced economies to maintain accommodative monetary policies in order to boost the slow growth.
According to the IMF Chief Economist Olivier Blanchard: “The brakes to the recovery are progressively being loosened. The drag from fiscal consolidation is diminishing. The financial system is slowly healing. Uncertainty is decreasing.”
The UK GDP forecast was raised significantly from 1.9% to 2.4%, which confirmed yesterday´s reports. As far as the Eurozone is concerned, the IMF saw it growing by 1% this year. Blanchard emphasized that the recovery in the area was weak and uneven and urged the ECB to reduce its financial fragmentation as soon as possible. He also pointed to a 10-12% deflation risk in the Eurozone.
The growth outlook for the US was raised to 2.8% from 2.6%. The IMF Chief Economist said that the Fed policy framework and timing were reasonable and that he did not expect the FOMC to withdraw stimulus too soon.
Furthermore the IMF rose its 2014 growth forecast for Japan to 1.7% from 1.2% seen previously. It also projected that the Chinese economy would expand by 7.5% this year.