(6 February 2023 – Global) The International Monetary Fund (IMF) last week revised upward its global growth projections for the year, but warned that higher interest rates and Russia’s invasion of Ukraine would likely still weigh on activity.
According to the IMF, global growth would still fall to 2.9 percent in 2023 from 3.4 percent in 2022, but its latest World Economic Outlook forecasts mark an improvement over an October prediction of 2.7 percent growth this year, with warnings that the world could easily tip into recession.
For 2024, the IMF said global growth would accelerate slightly to 3.1 percent, but interest rate hikes by central banks around the world would slow demand.
“The year ahead will still be challenging… but it could well represent a turning point with growth bottoming out and inflation declining,” said IMF Chief Economist, Pierre-Olivier Gourinchas.
“The outlook is not worsened this time around, which in itself is good news,” he added. The fund cut its 2023 outlook three times last year. “But it’s not enough. There are still some challenges to get on our way to a sustainable recovery that is broad and long-lasting.”