THE International Monetary Fund on Tuesday slashed its forecast for global growth this year, citng the effect of US President Donald Trump’s new tariff policies on the world economy.
The IMF’s projections, which in-corporate some but not all tariff meas-ures introduced this year, see the global economy growing by 2.8 per cent this year, 0.5 percentage points lower than the previous World Economic Outlook (WEO) forecast in January.
Global growth is then forecast to hit3.0 per cent next year, down 0.3 percent-age points from January.
“We are entering a new era as the global economic system that has operated for the last 80 years is being re-set,” IMF chief economist Pierre-Olivier Gourinchas told journalists ahead of the report’s publication.
“The risks to the global economy have increased and are firmly to the downside,” he added, noting that the recent US tariff announcements had more than halved the Fund’s outlook for global trade growth this year.
The WEO was published as global financial leaders gathered in Washing-ton for the World Bank and IMF Spring Meetings, which are hosted by the two international financial institutions at their headquarters a stone’s throw from the White House.
Given the stop-start nature to Trump’s tariff rollout, the IMF introduced a cutoff date of 4 April, meaning they do not include the administration’s latest salvos, which have hiked the level of new levies against China to 145 per cent. — AFP