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October 21, 2021

IMF to revise up global growth forecasts

The International Monetary Fund will revise upward its global growth forecast in about three weeks, Managing Director Christine Lagarde has revealed, telegraph.co.uk reports. “We will be revising upwards the global forecast of the economic growth,” she told a press conference in the Nairobi, after she dined with Kenyan President Uhuru Kenyatta on Monday evening in the coastal city of Mombasa. Lagarde adds that it would be premature to say any more. IMF chief gave no reason for the revision. When it issued its latest World Economic Outlook report in October, the IMF lowered its forecasts, saying that global growth “remains in low gear”. It said it expected the global economy to grow 2.9 per cent year-on-year in 2013 and 3.6 per cent in 2014. That represented a downward revision of 0.3 and 0.2 percentage points, respectively, from its July estimates. Emerging market economies, although still accounting for most global growth, were losing more momentum than previously thought, the IMF said in November, although advanced economies, in particular the US, were showing signs of picking up.
The fact that the US Federal Reserve has started to change the easy-money policy it had been pursuing has had the effect of slowing capital inflows to emerging-market economies as long-term yields in the US and many other economies have risen, Lagarde said.
According to bbc.co.uk, last month the US Commerce department revised US growth upwards to its fastest pace since late 2011. It said GDP grew at an annualised rate of 4.1 per cent between July and September, up from an earlier 3.6 per cent estimate. Citing those stronger growth figures, US President Barack Obama has said 2014 will be a “breakthrough year” for the US economy. The Office for National Statistics (ONS) raised its forecast for annual growth to 1.9 percent from 1.5 per cent.
Lagarde’s visit came a month after the final disbursement of a three-year, USD 750 M support loan for Kenya that had backed major restructuring of economic policies and strengthening of the government’s financial position.

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