The International Monetary Fund (IMF) has made some adjustments to its economic outlook for various countries. China, India, and Europe are seeing upgrades, while the expectations for the United States and Japan have been slightly lowered. The IMF noted that progress in combatting rising prices has been slowed down by persistent inflation in service sectors such as airline travel and restaurant meals.
Overall, the IMF maintained its prediction that the global economy will grow by 3.2% this year, the same as forecasted in April but slightly lower than the 3.3% growth seen in 2023. Prior to the pandemic, global growth had averaged 3.8% annually from 2000 to 2019.
As a 190-nation lending institution, the IMF aims to stimulate economic growth, ensure financial stability, and alleviate global poverty. The organization’s chief economist, Pierre-Olivier Gourinchas, mentioned in a blog post that China and India are expected to contribute significantly to global growth this year.
Due to a surge in Chinese exports at the beginning of 2024, the IMF raised its growth projection for China to 5% from the 4.6% estimated in April, although this is lower than the 5.2% growth seen in 2023. An official report from Beijing indicated that the Chinese economy, the second-largest in the world after the United States, grew at a slower rate of 4.7% annually from April to June, down from 5.3% in the first three months of the year.
China is currently encountering challenges such as the housing market downturn and a progressively aging population leading to labor shortages. Gourinchas projected that China’s growth would decrease to 3.3% by 2029.
India’s economy, on the other hand, is anticipated to expand by 7%, up from the 6.8% forecasted in April, partly due to increased consumer spending in rural areas.
