"IMF slashes world growth forecasts and sounds alarm over fragile recovery"

From City AM:

The world is facing an onslaught of risks which could upset the economic recovery, the International Monetary Fund has warned, as it cut its forecasts for growth in the global economy.

The IMF’s half-yearly world economic outlook, published today, said that everything from weak growth in Europe, volatile oil prices, the Chinese slowdown, a commodities slump and falling asset prices could destabalise an already precarious world economy.

This year, the IMF expects economic output to expand by 3.2 per cent, down from a 3.4 per cent prediction made just three months ago. In 2017, it predicted growth of 3.5 per cent - a 0.1 per cent cut on January’s outlook.

“The global recovery has weakened further amid increasing turbulence,” the IMF said. “Activity softened towards the end of 2015 in advanced economies, and stresses in several large emerging market economies showed no signs of abating.”

In advanced economies, “weak external demand, further exchange rate appreciation - especially in the United States - and somewhat tighter financial conditions will weigh on the recovery”.

“If sustained, these developments could further weaken growth, with risks of a stagnation scenario with persistent negative output gaps and excessively low inflation.”

April 2016 growth forecasts

Country	2016 forecast (change from January)	2017 forecast (change from January)
United States	2.4 (down 0.2)	2.5 (down 0.1)
Eurozone	1.5 (down 0.2)	1.6 (down 0.1)
Japan	0.5 (down 0.5)	-0.1 (down 0.4)
UK	1.9 (down 0.3)	2.2 (no change)
Canada	1.5 (down 0.2)	1.9 (down 0.2)
Russia	-3.7 (down 0.8)	-1.8 (down 0.2)
China	6.5 (up 0.2)	6.2 (up 0.2)
India	7.5 (no change)	7.5 (no change)
Brazil	-3.8 (down 0.3)	0 (no change)
Mexico	2.4 (down 0.2)	2.6 (down 0.3)
Saudi Arabia	1.2 (no change)	1.9 (no change)
Nigeria	2.3 (down 1.8)	3.5 (down 0.7)
South Africa	0.6 (down 0.1)	1.2 (down 0.6)

Britain’s economy is chalked up to grow by 1.9 per cent this year - a 0.3 per cent cut from January and the second sharpest revision of any member of the G7. Nevertheless, that will still trail only the United States among the group of seven rich countries, which is expected to grow by 2.4 per cent this year and 2.5 per cent in 2017....MORE