IMF, CEOs sound warnings as leaders gather in Davos

IMF, CEOs sound warnings as leaders gather in Davos

IMF, CEOs sound warnings as leaders gather in Davos

It also kept its China growth forecast for this year and next at 6.2 percent, but said economic activity could miss expectations if trade tensions with the USA persist.

At the launch of the report in Davos, Switzerland, Gopinath said: "The global expansion is weakening and at a rate that is somewhat faster than expected".

That's right Mark... The IMF predicts the global economy to grow at 3.5 percent in 2019 and 3.6 percent in 2020. The United States is expected to see growth drop to 2.5% this year and 1.8% in 2020, China is expected to fall from 6.6% in 2018 to 6.2% in the next two years, while the Euro Area is projected to grow by 1.6% this year and 1.7% in 2020.

Bulltick Capital Markets' Kathryn Rooney Vera on China's economic slowdown, US trade talks with China and the outlook for the global markets.

The latest global economic forecasts was even more pessimistic than those released just three months ago, the International Monetary Fund emphasized that risks dominate the outlook.

She also suggested policy priorities to mitigate global risks.

Rising trade tensions pose a major risk to the world economy.

In its second downgrade in three months, the global lender also cited a bigger-than-expected slowdown in China's economy and a possible "No Deal" Brexit as risks to its outlook, saying these could worsen market turbulence in financial markets.

The IMF has been urging policymakers to carry out structural reforms while the global economy enjoys solid growth, with Lagarde telling them to "fix the roof while the sun is shining".

The Chinese economy is transitioning from one based on trade to one driven by domestic consumption, says Fotios Raptis, senior economist at TD Bank.

The IMF sees growth in Saudi Arabia for 2019 at 1.8 percent, compared to 2.4 percent expected last October, while it lifted its 2020 economic growth forecast by 0.2 percentage point from October to 2.1 percent. "We expect growth of about 1.5 percent this year, up from 0.5 percent in 2018", Ashbourne said. Countries should quickly resolve their trade disagreements and the resulting policy uncertainties, rather than raising more harmful barriers and destabilising an already slowing global economy.

The WEO also forecast 1.5 percent 2019 growth for Britain, the same as in October, but warned the estimate is fraught with uncertainty since "as of mid-January, the shape that Brexit will ultimately take remains highly uncertain". Under President Donald Trump, the USA has imposed import taxes on steel, aluminum and hundreds of Chinese products, drawing retaliation from China and other US trading partners.

As the debts roll over, those borrowers have to refinance at higher rates.

Related news