▲ Up
 akipress
12:14 20-11-2018
АКИpress CA-News Tazabek Turmush
ADVERTISE WITH US SUBSCRIBE
KazakhstanKyrgyzstanMongoliaTajikistanTurkmenistanUzbekistanWorld
POLITICSBUSINESSINCIDENTSSOCIETYCULTURESPORTANALYSISSCIENCE
akipress
IMF raises global growth forecast, sees Trump tax boost
World | business | 10:01, 23 January 2018 | 1025

AKIPRESS.COM - The International Monetary Fund on Monday revised up its forecast for world economic growth in 2018 and 2019, saying sweeping U.S. tax cuts were likely to boost investment in the world’s largest economy and help its main trading partners, Reuters reported.

However, the IMF, in an update of its World Economic Outlook, also added that U.S. growth would likely start weakening after 2022 as temporary spending incentives brought about by the tax cuts began to expire.

The tax cuts would likely widen the U.S. current account deficit, strengthen the U.S. dollar and affect international investment flows, IMF chief economist Maurice Obstfeld said.

“Political leaders and policymakers must stay mindful that the current economic momentum reflects a confluence of factors that is unlikely to last for long,” Obstfeld told reporters at the World Economic Forum in Davos.

He said economic gains from the tax cuts would be partially paid back later in the form of lower growth as temporary spending incentives, notably for investment, expired and as rising federal debt took a toll.

IMF Managing Director Christine Lagarde pointed to a “troubling” increase in debt levels across many countries and warned policymakers against complacency, saying now was the time to address structural deficiencies in their economies.

Obstfeld said a sudden rise in interest rates could lead to questions about the debt sustainability of some countries and lead to a disruptive correction in “elevated” equity prices.

U.S. President Donald Trump signed Republicans’ massive $1.5 trillion tax overhaul into law in December, cementing the biggest legislative victory of his first year.

The tax package, the largest such overhaul since the 1980s, slashed the corporate rate from 35 percent to 21 percent and temporarily reduced the tax burden for most individuals as well.

Pointing to growth in the United States and China, the IMF forecast global growth to 3.9 percent for both 2018 and 2019, a 0.2 percentage point increase from its last update in October.

The U.S. economy has been showing steady but underwhelming annual growth since the last recession in 2007-2009. The IMF now expects it to expand by 2.7 percent in 2018, much higher than the 2.3 percent the fund forecast in October. U.S. growth was projected to slow to 2.5 percent in 2019, it said.

The IMF also revised up its growth forecasts for the euro area, especially for Germany, Italy and the Netherlands “reflecting the stronger momentum in domestic demand and higher external demand”.

However, it cut its forecast for Spain’s growth for 2018 by 0.1 percentage point, saying political uncertainty linked to the Catalonia region’s independence push was expected to impact business confidence and demand.

The IMF revised up its growth forecast for Japan to 1.2 percent this year and 0.9 percent in 2019. It maintained its projection for Britain’s growth at 1.5 percent this year.

The IMF maintained its forecast for growth in emerging markets and developing countries for this year and next. China’s economy was expected to expand 6.6. percent this year and slow to 6.4 percent in 2019.

It said growth in the Middle East, North Africa, Afghanistan and Pakistan was also expected to pick up in 2018 and 2019 but remain subdued at 3.6 percent this year.

The IMF revised down its growth estimate for South Africa to 0.9 percent for this year and next amid concerns over political uncertainty.

In Latin America, it said growth would be weighed down by an economic collapse in Venezuela despite a pick-up in economic activity in Brazil and Mexico.

LATEST NEWS
12:09 Atambayev on Ilmiyanov’s arrest: He knows a lot about past presidential election12:06 Bishkek city council meeting discusses subway creation, new deputy mayors introduced11:59 Political bosses of Kyrgyzstan must learn to respect each other: Jeenbekov11:53 Kyrgyzstan produces 1.17 million tons of coal in 9 months11:51 Ex-President Atambayev on his wealth: Factories in Turkey, Kyrgyzstan brought up over $26 million a year11:50 Japanese companies propose to build another gasoline production plant in Turkmenistan11:46 Kyrgyzstan exports 753.8 mln kWh of electricity to Uzbekistan11:33 Instagram will remove fake likes and followers11:24 Over 80 athletes from Kyrgyzstan, Kazakhstan and Uzbekistan participate in Bishkek Open Climbing Championship11:19 Nissan boss Carlos Ghosn arrested over 'misconduct'11:02 268 parents refused to vaccinate children for religious reasons in Naryn11:00 Support media freedom in Central Asia10:45 Air pollution in Bishkek exceeds normal level twice: State weather forecaster10:23 Ex-President Atambayev talks after 8 months of silence to counter ‘campaign of lie and slander’10:20 Kyrgyzstan to play against Japan today10:19 Photo of passport of Kyrgyz toddler named after Conor McGregor goes viral09:49 Mas-wrestling competition kicks off in Karakol09:45 80yo Bishkek woman filled her apartment with over 10 tons of trash09:37 Bishkek hosts student humanitarian forum dedicated to 100th anniversary of writer Soljenitsyn09:06 Female Kyrgyz lawmaker reports harassment inside White House
© AKIpress News Agency - 2001-2018. All rights reserved
Republication of any material is prohibited without a written agreement with AKIpress News Agency. Any citation must be accompanied by a hyperlink to akipress.com.
Our address:
Moskovskaya str. 189, Bishkek, the Kyrgyz Republic
e-mail: english@akipress.org, akipressenglish@gmail.com;
Tel/Fax: +996(312)65-03-06