News / Economy

IMF Lowers Its Global Economic Prospects

IMF Lowers Its Global Economic Prospectsi
X
July 10, 2013 11:49 PM
The International Monetary Fund has trimmed its outlook for the global economy. In its latest quarterly report, the IMF blamed the slowdown in part on what it called “continuing growth disappointments” in developing countries and a deeper than expected recession in Europe. But as Mil Arcega reports, the Washington-based agency said conditions are likely to improve as early as next year.
IMF Lowers Its Global Economic Prospects
The International Monetary Fund has trimmed its outlook for the global economy. In its latest quarterly report, the IMF blamed the slowdown in part on what it called “continuing growth disappointments” in developing countries and a deeper than expected recession in Europe. The Washington-based agency said conditions are likely to improve as early as next year.

The world’s economy is not growing as fast as many had hoped. The IMF revised its global growth forecast in 2013 to just a bit more than 3 percent - down from earlier projections of 3.3 percent.

IMF chief economist Olivier Blanchard said the revisions are based on several factors.

“The main effect really comes from the slowdown in emerging market economies, but we are also revising down the euro area forecast,” said Blanchard.

Global demand for goods and services has declined - especially in Europe - where a debt crisis and tough austerity measures have produced the longest economic slump in the 17-nation eurozone’s history.

Peter McGuire, Asia market strategist at Baxter FX, said, "It is not surprising. When you think about as far as global demand, that seems to be softening, and of course with Europe in the position that it's been in, it's just protracted slowness to a point of nearly negative growth across the whole zone. “

It's a vicious circle. Reduced demand has slowed growth in faster-growing economies, particularly in the so-called BRIC countries - Brazil, Russia, India, and China.  

Blanchard said that has repercussions for advanced economies.

“If, for example, growth in BRICs was to go down by two percent relative to what we predict, then the effect on the U.S., for example, would be half a percent. So it matters,” he said.

The IMF has lowered expectations for U.S. growth, even though recent housing and employment data suggest slow but steady progress.  

Steady enough, say some analysts, for the Federal Reserve to scale back on monetary policies that have kept long-term interest rates at record lows.

Although rising U.S. interest rates could create difficulties for some countries, Blanchard said it also would signal a stronger recovery for the world’s largest economy.

“Along the way, you may have quite a bit of volatility, but on that, the bottom line remains the same, which is - it’s good news for the world.”

The IMF sees improving global economic conditions in 2014, but only if the world’s major economies continue to promote policies that foster near-term growth, while cutting long-term debt.

You May Like

Photogallery Early Nigeria Results Show Buhari Leading; Tampering Concerns Mount

One local group monitoring polls is concerned politicians might use security agencies to 'fiddle with the election collation process' at state level More

UN: 7,300 Civilians Killed in Boko Haram Insurgency

A senior UN humanitarian official tells the United Nations Security Council 1,000 people have been killed this year More

Turkish President Warns Iran About Trying to Dominate Middle East

Warning comes amid growing concerns inside Turkey that it will be sucked into a sectarian conflict with its neighbor More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Film Tells Story of Musicians in Mali Threatened by Jihadistsi
X
Greg Flakus
March 30, 2015 6:48 PM
At this year's annual South by Southwest film and music festival in Austin, Texas, some musicians from Mali were on hand to promote a film about how their lives were upturned by jihadists who destroyed ancient treasures in the city of Timbuktu and prohibited anyone from playing music under threat of death. As VOA’s Greg Flakus reports from Austin, some are afraid to return to their hometowns even though the jihadists are no longer in control there.
Video

Video Film Tells Story of Musicians in Mali Threatened by Jihadists

At this year's annual South by Southwest film and music festival in Austin, Texas, some musicians from Mali were on hand to promote a film about how their lives were upturned by jihadists who destroyed ancient treasures in the city of Timbuktu and prohibited anyone from playing music under threat of death. As VOA’s Greg Flakus reports from Austin, some are afraid to return to their hometowns even though the jihadists are no longer in control there.
Video

Video With Coalition Airstrikes, Iraq Entering 'Last Page' of IS Battle

American warplanes joined Iraq's battle against the so-called 'Islamic State' in northern Iraq late Wednesday, as Iraqi ground troops launched a massive assault on Tikrit. Analysts say the offensive could take the coalition a step further towards Mosul, the largest city held by Islamic State forces. Others say it could also deepen already-dangerous sectarian tensions in the region. VOA's Heather Murdock has more from Cairo.
Video

Video Philippines Wants Tourists Spending Money at New Casinos

Tourism is a multi-billion dollar industry in the Philippines. Close to five million foreign visitors traveled there last year, perhaps lured by the country’s tropical beaches. But Jason Strother reports from Manila that the country hopes to entice more travelers to stay indoors and spend money inside new casinos.
Video

Video Civilian Casualties Push Men to Join Rebels in Ukraine

The continued fighting in eastern Ukraine and the shelling of civilian neighborhoods seem to be pushing more men to join the separatist fighters. Many of the new recruits are residents of Ukraine made bitter by new grievances, as well as old. VOA's Patrick Wells reports.
Video

Video Islamic State Prisoners Talk of Curiosity, God, Regret

Islamic State fighter, a prisoner of Kurdish YPG forces, asked his family asking for forgiveness: "I destroyed myself and I destroyed them along with me." The Syrian youth was one of two detainees who spoke to VOA’s Kurdish Service about the path they chose; their names have been changed and identifying details obscured. VOA's Zana Omer reports.
Video

Video Germanwings Findings Raise Issue of Psychological Testing for Pilots

More is being discovered about the co-pilot in the crash of Germanwings Flight 9525 in the French Alps. Investigators say he was hiding a medical condition, raising questions about the mental qualifications of pilots. VOA's Carolyn Presutti reports.
Video

Video Hi-tech Motorbike Helmet's Goal: Improve Road Safety

In cities with heavily congested traffic, people can get around much faster on a motorcycle than in a car. But a rider who is not sure of his route may have to stop to look at the map or consult a GPS. A Russian start-up company is working to make navigation easier for motorcyclists. Designers at Moscow-based LiveMap are developing a smart helmet with a built-in navigation system, head-mounted display and voice recognition. Zlatica Hoke has more.
Video

Video DOJ: Illinois National Guard Soldier Tried to Join ISIS

U.S. federal law enforcement agents arrested two suburban Chicago men accused of trying to join ISIS overseas, while also plotting attacks in the United States. As VOA’s Kane Farabaugh reports from the Midwest state of Illinois, one of those arrested is a soldier of the Illinois National Guard.
Video

Video New Wheelchair Is Easier to Use, Increases Mobility

Traditional push-rim wheelchairs create a lot of stress for arm, shoulder and neck muscles and joints. A redesigned chair, based on readily available bicycle technology, radically increases mobility while reducing the physical effort. VOA’s George Putic reports.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.

VOA Blogs

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

World Currencies

EUR
USD
0.9211
JPY
USD
119.18
GBP
USD
0.6722
CAD
USD
1.2509
INR
USD
62.518

Rates may not be current.