Global economy nears brink of recession, warns IMF
The global economy is teetering on the brink of recession, according to the International Monetary Fund.
The IMF pointed to evidence that the world’s three biggest economies – the US, China and the eurozone – are all stalling and inflation is higher than previously forecast.
In a downbeat update to its April world economic outlook, the IMF cut its growth forecasts for 2022 and 2023, and raised the prospect of a more pronounced slowdown.
The global economy is teetering on the brink of recession, according to the International Monetary Fund.
The IMF pointed to evidence that the world’s three biggest economies – the US, China and the eurozone – are all stalling and inflation is higher than previously forecast.
In a downbeat update to its April world economic outlook, the IMF cut its growth forecasts for 2022 and 2023, and raised the prospect of a more pronounced slowdown.
It said global output had fallen in the second quarter of this year – the first contraction since the start of the Covid-19 pandemic.
“The outlook has darkened significantly since April,” said the IMF’s economic counsellor, Pierre-Olivier Gourinchas. “The world may soon be teetering on the edge of a global recession, only two years after the last one.”
And there is even worse news for the UK. While the IMF has forecast growth of 3.2% in 2022, it said that will fall to just 0.5% in 2023 – cuts of 0.5 and 0.7 points since April. The IMF expects the UK to slow down markedly in the second half of this year and to be the weakest of the G7 economies in 2023.
It added that, by the fourth quarter of 2022, it was forecasting global inflation of 8.3%, up from its April estimate of 6.9%. It identified the UK – where inflation is now on course to be 2.7 points higher at 10.5% – as a place where cost of living pressures had particularly intensified.
The Guardian
