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IMF Slightly Raises Prediction for US Economic Growth

New cars are seen at a parking lot in Shenyang, Liaoning province, China, Jan. 16, 2017.

The International Monetary Fund slightly raised its forecast for U.S. economic growth this year and in 2018, reflecting a pledge by the new Trump Administration to increase spending on the military and infrastructure.

The IMF predicts the U.S. economy will expand 2.3 percent this year and a little faster next year. During the campaign, President-elect Donald Trump said his plans to boost spending, slash taxes and cut regulation would raise growth to four percent.

Monday's IMF report also says the global economy will probably expand.

Economists say more spending tends to stimulate growth, but caution it is uncertain how much of Trump's program will pass Congress. Experts also caution that if the economy overheats, the U.S. central bank might raise interest rates in an effort to keep inflation at a low level.

The IMF raised growth estimates for China, based on expected efforts to stimulate that economy. Growth predictions were revised downward for other large emerging economies like India, Brazil, and Mexico.

The global lender says growth could be slower than predicted if there is a major shift toward protectionism that hurts international trade.