The Strategist

IMF to "significantly" worsen global economic growth forecast

07/18/2022 - 10:00

The chief of the IMF's strategy department forecasted that the organization would be compelled to "substantially" lower its estimate of global economic growth.
In its July forecast, the International Monetary Fund (IMF) will need to "substantially" lower its projection for global economic growth, said Ceyla Pazarbasioglu, the director of the IMF's Strategy, Policy, and Analysis Department.

Legislators have found it "far more difficult" to develop an economic policy due to rising food and energy prices, decreasing capital inflows to emerging economies, the lingering pandemic, and slower economic development in China, she said. Pazarbasioglu characterized the scenario as "shock after shock after another shock that is truly affecting the world economy."

The IMF already revised its estimate for economic growth downward in April, from 4.4 percent to 3.6 percent. The fund will once again "substantially lower its forecast" in a review due out this month, according to Pazarbasioglu.

She was speaking after the G20's finance ministers and central bank governors adjourned their meeting on Saturday without issuing a joint statement. According to Bloomberg, this only serves to highlight how challenging it is to coordinate an international response to rising inflation and worries about recessions.