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IMF downgrades UK and US growth forecasts

International Monetary Fund cuts economic growth expectations for both UK and US this year but maintains its global forecast.

IMF downgrades UK and US growth forecasts

The International Monetary Fund (IMF) has downgraded its economic growth expectations for the UK from 2% to 1.7% as it warned of weaker-than-expected activity in the fourth quarter.

The organisation also revised down its outlook for the US in 2017 from 2.3% to 2.1%, citing ‘the assumption that fiscal policy will be less expansionary than previously assumed’.

Overall, the IMF maintained its prediction of a 3.5% rise in global economic output in 2017 and 3.6% in 2018. Elsewhere among the major developed economies, it revised up its forecasts for growth in Canada, Japan and several EU countries, including Germany, France and Spain.

The IMF said: ‘The unchanged global growth projections mask somewhat different contributions at the country level. US growth projections are lower than in April, primarily reflecting the assumption that fiscal policy will be less expansionary going forward than previously anticipated.

‘Growth has been revised up for Japan and especially the euro area, where positive surprises to activity in late 2016 and early 2017 point to solid momentum.’

The organisation added: ‘China’s growth projections have also been revised up, reflecting a strong first quarter of 2017 and expectations of continued fiscal support. Inflation in advanced economies remains subdued and generally below targets; it has also been declining in several emerging economies, such as Brazil, India, and Russia.’

2 comments so far. Why not have your say?

Andrew Stevenson

Jul 24, 2017 at 15:16

These people really have the most amazing chutzpah.

Forecast after forecast is wrong, but never once do they refer to their useless record.

"“THE only function of economic forecasting is to make astrology look respectable,” John Kenneth Galbraith"

Spot on Mr Galbraith

report this

Bill Fowler

Jul 24, 2017 at 17:44

Next crash is due in Asia any time soon, so these predictions are moot

report this

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