International Monetary Fund increases growth projection for Nigeria

Lloyd Doyle
April 10, 2019

India, however, remains a bright spot in a global economy, whose growth is expected to be only 3.3 per cent this year, down from last year's 3.6 per cent, but expected to reach that figure next year.

But chances of further cuts to the outlook are high, the Fund said in its World Economic Outlook report.

The IMF has estimated that due to an economic slow down, unemployment in Pakistan will rise to 6.2% in the next fiscal year from the current 6.1%.

Gopinath said a sharp downturn might require synchronized fiscal stimulus "across economies" as well as loose monetary policy.

Its global growth forecast for 2019 was also lower than the earlier projection of 3.7 percent in the October 2018 WEO. The IMF, however, expected current account deficit to narrow at 5.2 percent in 2019 and 4.3 percent in 2020 as opposed to 6.1 percent in 2018. Global growth softened to 3.6 per cent in 2018 and is projected to decline further to 3.3 per cent in 2019.

The fund said avoiding such "policy missteps. needs to be the main priority", including "distorstionary barriers" to trade.

A spokesman for Britain's finance ministry said the government wanted to leave the European Union with a deal but was getting ready for a possible no-deal Brexit. Despite looming deadlines, London has not decided how it will try to shield its economy during the exit process.

In more bad news for Europe's biggest economy, the International Monetary Fund said Germany will now grow just 0.8 per cent in 2019, meaning the organisation has cut its growth prediction for the country by over half since October in two consecutive downgrades. The IMF said it was assuming an orderly "Brexit".

In the coming fiscal year, the projected GDP growth is likely to remain at 2.8 %, nearly the lowest in a decade. In Eurozone economies, consumer and business confidence weakened in Germany a year ago, as its sizeable auto production industry was disrupted by the introduction of new emission standards, and investment dropped in Italy on lower demand. It was largely expected but it's a reminder that the entire reversal in market sentiment was based on a turn in central banks, not a turn in the real economy. The IMF also cut Japan's growth outlook following a string of natural disasters.

Cuts US to 2.3% from 2.5%.

US Treasury yields slid on concerns about the global economic outlook while the S&P 500 index and the Dow Jones Industrial Index were down more than half a per cent amid worries that a USA threat to slap tariffs on hundreds of European goods would be a further economic drag.

A no-deal Brexit would see the United Kingdom economy shrink 1.4pc this year.

"The projection is 0.3 percentage point and 0.2 percentage point lower for 2019 and 2020, respectively, than in the October 2018 WEO, reflecting downward revisions for Angola and Nigeria with the softening of oil prices".

For emerging markets and developing countries, growth is expected to steady at 4.8% over the medium term and given that these groups are growing faster than advanced economies, their contribution to global growth is expected to increase from 76% to 85% over the next five years. -China trade war had not materialized. -China trade tensions, macroeconomic stress in Turkey and Argentina, tighter credit policies in China and financial tightening plus a normalisation of monetary policy in advanced economies.

The IMF cut its 2019 growth forecasts for Canada and Latin America as well as for the Middle East and North African countries.

China's prospects brightened, the fund said, after President Donald Trump chose to suspend a planned increase in tariffs on $200 billion worth of USA -bound Chinese exports.

Trump's aggressive trade policies, largely, but not exclusively, aimed at China, left United States products open to retaliation in the form of steep tariffs.

Other reports by Iphone Fresh

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