IMF Retains Global Growth Projections; Trims US GDP Outlook

The International Monetary Fund on Monday maintained its global growth projections saying the pickup in global growth remains on track as anticipated in April.

Global output is forecast to grow by 3.5 percent in 2017 and 3.6 percent in 2018. The unchanged growth projections mask somewhat different contributions at the country level, the Washington-based lender said in its World Economic Outlook Update.

"Short-term risks are broadly balanced, but medium-term risks are still skewed to the downside," the Washington-based lender said.

The growth forecast in the United States has been revised down further to 2.1 percent from 2.3 percent in 2017 and to 2.1 percent from 2.5 percent in 2018. The downward revision is based on the assumption that fiscal policy will be less expansionary going forward.

On the other hand, Eurozone growth outlook was revised up citing stronger momentum in domestic demand than previously anticipated. GDP is forecast to climb 1.9 percent this year and 1.7 percent in 2018. The projections were revised from 1.7 percent and 1.6 percent, respectively.

The growth forecast has been revised down for the United Kingdom for 2017 on weaker-than-expected activity in the first quarter. The economy is forecast to grow 1.7 percent in 2017 and 1.5 percent in 2018.

Japan's growth is forecast to improve to 1.3 percent this year before easing to 0.6 percent in 2018. The projection for 2017 was revised up from 1.2 percent and the 2018 estimate was maintained.

Emerging and developing economies are projected to see a sustained pickup in activity, with growth rising from 4.3 percent in 2016 to 4.6 percent in 2017 and 4.8 percent in 2018, the lender said.

China's growth projections have been revised up, reflecting a strong first quarter of 2017 and expectations of continued fiscal support.

China's growth is expected to be at 6.7 percent in 2017, up from the previous estimate of 6.6 percent but the same level as in 2016. For 2018, the lender projected 6.4 percent expansion instead of 6.2 percent.

At the same time, India's growth projections were left unchanged. India's 2017 growth is seen at 7.2 percent, before accelerating to 7.7 percent in 2018.

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