International Monetary Fund significantly improves Slovenia's GDP growth forecast to 4.0% in 2018

The IMF, in its latest World Economic Outlook, kept its global growth forecasts for both 2018 and 2019 unchanged at 3.9 percent after upgrades in January that were partly based on expectations of stronger US spending spurred by tax cuts.

"And because the United States boost accounts for most of the higher world expansion, beyond 2019 "global growth is projected to gradually decline to 3.7% by the end of the forecast horizon", the report said".

The IMF on Tuesday projected a global growth of 3.9 percent in the next two years due to strong momentum, favourable market sentiment among other factors but warned that any trade disputes threaten to undermine confidence and derail global growth prematurely.

The IMF increased its forecast for expansion in Sub-Saharan Africa to 3.4% this year and 3.7% the next "as the challenging outlook in commodity exporters gradually improves". "The global economic upswing that began around mid-2016 has become broader and stronger", Maurice Obstfeld says in the introduction to the spring edition of the World Economic Outlook (WEO).

Commodities, including oil, gold and cocoa, are the mainstay of Ghana's $43bn economy, which surged 8.5% past year as the Sankofa crude field started up in May. That's better than the institution's forecasting department expected six months ago and an improvement on the 3.8-per-cent increase in 2017.

The IMF has also predicted Chinese growth of 6.6% this year, an increase of 0.1% on the last forecast, while Japan is set for growth of 1.2%, a 0.5% uplift. The choices governments, central banks, and regulators make now will determine how long this moment lasts.

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China's growth rate is projected to be be 6.6 percent this year and slide to 6.4 percent next year.

According to the International Monetary Fund, expansion of investment in many economies accelerated growth to over 4 percent in the second half of 2017, the highest figure since 2010.

A preliminary assessment made by the International Monetary Fund concluded that while assets tied to cryptocurrencies don't pose an immediate danger to the global financial system because their footprint is still small, they have the potential to magnify the risks and increase the transmission of economic shocks.

But while advanced economies are expected to grow at 2.5% in 2018, slowing thereafter to 2.2% in 2019, emerging market and developing economies are expected to pick up the slack, growing at 5.1% in 2019, up from 4.9% in 2018.

The report notes that the sweeping United States tax cuts approved in December will fuel higher growth only through next year, and after that will "subtract momentum". One third of that uplift in USA growth is attributed to the Trump tax reform. Those aren't the growth rates of around 4 per cent that Trump promised, but they are pretty good all the same.

The IMF has also strongly criticised the approach of the Trump administration to trade deficits.

  • Ronnie Bowen