L’FMI riduce nuovamente le stime di crescita

(Bloomberg) — The International Monetary Fund further
reduced its global growth outlook, already the lowest since the
financial crisis, and suggested that policy “missteps” on trade
and Brexit could derail a projected rebound.
The world economy will expand 3.2% this year and 3.5% next
year, both down 0.1 percentage point from April projections, the
fund said in its latest quarterly World Economic Outlook
released Tuesday in Washington. A rate of 3.3% or lower would be
the weakest since 2009. The IMF also slashed expectations for
growth in the global volume of trade in goods and services,
reducing its estimate by 0.9 point to 2.5% in 2019.
“The projected growth pickup in 2020 is precarious,
presuming stabilization in currently stressed emerging market
and developing economies and progress toward resolving trade
policy differences,” the IMF said.

The warnings about the brittle state of the world economy
follow weaker readings on China’s growth and come just before
U.S. GDP data due this week, which are forecast to show growth
cooled in the second quarter.
Central banks have been monitoring trade tensions and
slowing growth globally. The Federal Reserve is poised to cut
interest rates at the end of this month for the first time in
more than a decade.
Since the IMF’s last forecast in April, the Trump
administration has increased tariffs on Chinese imports sharply
— with China responding in kind — though the U.S. and China
agreed in late June to resume talks and avoid more tariffs.
While the IMF saw global trade slowing this year more
significantly as a result of the trade tensions, it predicted a
bounce back to 3.7% growth in volumes in 2020, the same pace as
2018.
“The principal risk factor to the global economy is that
adverse developments — including further U.S.-China tariffs,
U.S. auto tariffs, or a no-deal Brexit — sap confidence, weaken
investment, dislocate global supply chains, and severely slow
global growth below the baseline,” the IMF said.

Country Forecasts

The IMF cut China growth estimates to 6.2% this year and 6%
next year, both down 0.1 percentage point. Second-quarter GDP
data released last week showed a deceleration to 6.2% expansion
for the country, the weakest pace since quarterly data began in
1992.
The U.S. forecast was raised 0.3 point to 2.6%, on a
better-than-anticipated performance in the first quarter, but
the IMF’s 2020 estimate was unchanged at 1.9% on waning fiscal
support. Second-quarter GDP data due Friday will show growth
slipped to 1.8% from a 3.1% annualized pace in the first
quarter, according to Bloomberg’s survey of economists.

Trade Tensions

The IMF said the risks facing the global economy included
trade tensions denting investment, the continuing impact of low
interest rates on investors’ risk appetite and disinflationary
pressures that would make servicing debt harder, and constrain
central banks’ ability to use monetary policy in downturns.
Trade was also a main concern last week in the IMF’s annual
External Sector Report, with Chief Economist Gita Gopinath
warning that such conflicts are weighing on the global economy.
“It’s absolutely urgent to end these trade wars as soon as
possible, to not escalate, and also to roll back the tariffs in
place,” Gopinath said in an interview with Bloomberg’s Tom Keene
ahead of Tuesday’s report. “That will have a big boost to
business sentiment that will raise investment and be good for
the global economy.”
Read more: Trade Is Still Unbalanced and Tariffs Aren’t the
Fix, IMF Says
In the U.K., a six-month Brexit extension announced in
April “provided some initial reprieve,” the IMF said. The fund
raised its 2019 growth estimate for the economy by 0.1 point to
1.3%, but the forecast assumes an “orderly Brexit” and the
ultimate form of the transition is “highly uncertain.”

Other Highlights

* The Washington-based fund boosted its overall growth
projection for advanced economies by 0.1 point to 1.9% in 2019.
* The IMF lowered the estimate for emerging-market and
developing nations by 0.3 point to 4.1%. That pace was seen
rebounding the following year to 4.7%.
* It left its euro-area growth projection unchanged at 1.3%,
while lowering Japan’s 0.1 point to 0.9%.
* The estimate for Brazil was cut by 1.3 point to 0.8% on
persistent uncertainty about pensions and other reforms.