On Tuesday, the IMF maintained its forecast for global GDP growth this year at 3.2%, but cut 2023 growth by 0.2 percentage points (pp.) to 2.7%, with a 25% chance of falling. fall below 2%.
In its updated economic projections, released today, the International Monetary Fund (IMF) estimates that more than a third of the global economy will contract this year or next, while the three largest economies – the United States, the European Union and China – will remain stagnant. .
“The worst is yet to come, and for many people 2023 will look like a recession,” Pierre-Olivier Gourinchas, chief economist at the institution, warns in the report.
The IMF warns that the world is facing a volatile period, whether economically, geopolitically and environmentally, with an impact on global prospects, especially highlighting the consequences of the war in Ukraine.
Even so, it maintains the global growth outlook for this year without changes compared to the estimates published in July, but it revises down those for next year, which are still significantly higher than those projected in April.
“Forecasts are weaker than expected for 143 economies for 2023. The forecast for 2023 is the weakest since the 2.5% growth rate seen during the 2001 global recession, with the exception of those during economic crises financials and Covid-19,” he says.
The IMF improved by 0.5 pp. this year’s forecast for the euro zone, to 3.1%, compared to July, but cut by 0.7 pp. that of 2023, at 0.5%.
The slowdown in growth will also be felt in the United States, with the Bretton Woods organization revising down 0.7 pp. the forecast for this, to 1.6%, estimating an expansion in the next year of 1%.
For China, it forecasts GDP growth of 3.2% this year and 4.4% in 2023, 0.1 pp less. and 0.2pp. less, respectively, than before.
Despite the scenario, the IMF notes that “a decline in global GDP or global GDP per capita, which often occurs when there is a recession, is not currently in the baseline forecast.”
However, it admits that a technical recession (at least two consecutive quarters with real GDP contraction) sometime during 2022-23 in about 43% of economies with quarterly data forecasts (31 of 72 economies), which It represents more than a third of world GDP.
The IMF notes that downside risks to the outlook remain high, considering that “the risk of monetary, fiscal, or financial policy miscalibration has risen sharply at a time when the global economy remains historically fragile and financial markets show signs of stress.
Source: TSF
