Global growth likely to see downturn at 2.9% in 2023: IMF
Updated 1/29/2023 8:34:00 AM
Arab Finance: The International Monetary Fund (IMF) expects global growth to decline to 2.9% in 2023, according to IMF’s World Economic Outlook report for January.
Moreover, the major financial agency projects global growth to likely rise to 3.1% in 2024.
“The rise in central bank rates to fight inflation and Russia’s war in Ukraine continue to weigh on economic activity. The rapid spread of COVID-19 in China dampened growth in 2022, but the recent reopening has paved the way for a faster-than-expected recovery,” the report highlighted.
As per the report, global inflation is forecast to fall to 6.6% in 2023 and 4.3% in 2024, which are above pre-pandemic levels of about 3.5%.
The report also added that most economies prioritize sticking to “achieving sustained disinflation” amid the cost-of-living crisis.
“With tighter monetary conditions and lower growth potentially affecting financial and debt stability, it is necessary to deploy macroprudential tools and strengthen debt restructuring frameworks,” the report said.
Furthermore, the IMF stressed the necessity of more solid multilateral cooperation “to preserve the gains from the rules-based multilateral system and to mitigate climate change by limiting emissions and raising green investment”.
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