IMF Cuts 2012 Global Growth Forecast: Report
Saturday, 21 January 2012 | 00:00
The International Monetary Fund will downgrade the global growth outlook for 2012 to 3.3 percent from 4 percent, The Daily Telegraph reported Friday, citing a leaked draft of the World Economic Outlook.
The World Economic Outlook report is due next week. The IMF sees a 2.2 percent contraction for Italy and a 1.7 percent GDP decline for Spain, as economies are weighed down by fiscal austerity measures.
"The global recovery is threatened by the growing tensions in the euro area," the Fund reportedly said. Eurozone as a whole will contract 0.5 percent, in contrast to its prior estimate of 1.1 percent growth.
The U.K. economy is forecast to expand 0.6 percent before advancing by 2 percent next year, the report said. The IMF continues to expect the U.S. economic growth to be 1.8 percent, while it scaled down Chinese GDP growth to be 8.2 percent.
The IMF also exhorted the European Central Bank to boost liquidity to stave off a deeper Eurozone crisis.
Telegraph indicated in the report that the leaked document was originally carried by Italy's ANSA news agency and also cautioned that the final wording of the document may change.
The World Bank this week slashed its global growth projection for 2012 to 2.5 percent from 3.6 percent. The lender estimates a 3.1 percent expansion for next year.
Source: RTT News
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