Turkey- IMF cuts global growth forecast over China''s slowdown
Date
10/7/2015 3:54:14 AM
(MENAFN- The Journal Of Turkish Weekly)Global economic growth is expected to be slower than previously forecast as China's economic slowdown and weak commodity prices continue the International Monetary Fund (IMF) said Tuesday.
In an update to its World Economic Outlook the IMF cut its global growth forecast 0.2 percentage points to 3.1 percent for 2015 and to 3.6 percent for 2016.
“The distribution of risks to global growth remains tilted to the downside” the fund said.
“Downside risks to growth for emerging market and developing economies have increased given the combination of risks from China’s growth transition more protracted commodity market rebalancing increased foreign-currency exposure of corporate balance sheets and capital flow reversals associated with disruptive asset price shifts” the report said.
Emerging economies were also expected to show weaker performance this year.
The growth forecast for these economies was cut to 4 percent for 2015 due to a sharp decline in commodity prices. The forecast is 0.2 points below its July forecast.
“In emerging market economies the continued growth slowdown reflects several factors including lower commodity prices and tighter external financial conditions structural bottlenecks rebalancing in China and economic distress related to geopolitical factors” the IMF said.
The U.S. economy is expected to grow by 2.6 percent this year and by 2.8 percent next year. China’s economy is forecast to grow by 6.8 percent and 6.3 percent respectively.
The fund sees growth in Turkey slowing to 3 percent this year and 2.9 percent in 2016. The IMF has updated its inflation forecast for the county to be 7.4 percent in 2015 up from its previous forecast of 6.6 percent.
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