With the latest outlook, India will remain the fastest-growing economy in the world, at least for the next two years, according to Indian media reports.
China recently announced its gross domestic product (GDP) recorded its lowest growth rate in 28 years at 6.6 per cent for 2018. IMF's latest updat of the World Economic Outlook (WEO), however, projected global growth at 3.5 per cent in 2019 and 3.6 per cent in 2020 — 0.2 and 0.1 percentage points lower than last October’s projections.
“The downward revisions are modest; however, we believe the risks to more significant downward corrections are rising. While the financial markets in advanced economies appeared to be decoupled from trade tensions for much of 2018, the two have become intertwined more recently, tightening financial conditions and escalating the risks to global growth,” Gita Gopinath, chief economist of IMF, said in her blog on the outlook.
Suggesting policy priorities to mitigate global risks, she said policymakers need to act now to reverse headwinds to growth and prepare for the next downturn. Countries should quickly resolve their trade disagreements and the resulting policy uncertainties, rather than raising more harmful barriers and destabilising an already slowing global economy, she added. (DS)