IMF's World Economic Outlook highlights emerging economies in lead

IMF's World Economic Outlook highlights emerging economies in lead

The IMF releases its World Economic Outlook report in April and September or October and publishes updates in January and July.

It upgraded its expectations for a number of eurozone countries, including Germany, France, Italy and Spain, and its overall global predictions remain unchanged at 3.5 per cent growth this year and 3.6 per cent in 2018.

U.S. President Donald Trump's failure to push through his promised corporate tax cuts and other pro-business legislation has hindered U.S. growth prospects, according to the outlook.

The 2017 growth projection for China was revised upward 0.1 point to 6.7 percent and that for five Association of Southeast Asian Nations members - Indonesia, Malaysia, the Philippines, Thailand and Vietnam - was raised 0.1 point to 5.1 percent.

USA growth was revised lower by the International Monetary Fund to 2.1% for both 2017 and 2018 from earlier estimates of 2.3% and 2.5% respectively, as it reassessed expectations of a President Trump-led package of economic boosting reforms.

The IMF in April raised its forecasts for British growth after the economy withstood the initial shock of the referendum decision in June a year ago to leave the EU.

However, the International Monetary Fund also listed further reforms that India must undertake, including replacing the demonetised currency and reducing labour and product market rigidities to ease firm entry and exit, expand the manufacturing base, and gainfully employ the abundant pool of labour. It kept its 2018 growth estimate for these five countries at 5.2%.

"Our projections for long-term British growth are actually based on a pretty optimistic assessment of how the negotiations are likely to turn out, so if things are worse than that it will turn out to be correspondingly worse for the British economy".

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Global output is projected to grow by 3.5 per cent in 2017 and 3.6 per cent in 2018, said the report.

The IMF has also warned against strong credit growth that may come with rising downside risk to medium-term growth.

China's growth projections have also been revised up, reflecting a strong first quarter of 2017 and expectations of continued fiscal support.

World: 2016 3.2 per cent, 2017 3.5, 2018 3.6.

On monetary policy, the IMF said a faster-than-expected rise in USA interest rates could tighten global financial conditions and trigger reversals in capital flows to emerging economies.

The US outlook for this year was revised down from 2.3 percent to 2.1 percent.

Official data due on Wednesday is forecast to show that economic growth picked up only slightly in the three months to the end of June.

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