IMF revises its estimates of global economic developments
The International Monetary Fund (IMF) has revised its estimates for the world economy this year. After growing by 3.4% in 2022, the world economy will slow to 2.8% in 2023, 0.1 percentage points less than forecast in January, according to the latest World Economic Outlook published on Tuesday by the international financial institution. According to the report, the global economy is recovering very slowly from high inflation and the consequences of the Russian invasion of Ukraine.
The International Monetary Fund kept its global economic forecast largely unchanged from January, however after the latest edition of the World Economic Outlook was published, IMF economic adviser Pierre-Olivier Gourinchas said the changes in the UK government bond market last autumn and last month's US banking turmoil showed what vulnerabilities exist among both banks and non-bank financial institutions.
"According to our latest forecast, global growth will be 2.8% this year before rising, modestly, to 3% next year, almost unchanged from our January forecast. Headline inflation will ease, albeit more slowly than initially expected. From 8.7% last year to 7% this year and 4.9% next year. The sharpest economic slowdowns this year will be in the advanced economies, where a decline of up to 1.3% is expected," said Pierre-Olivier Gourinchas.
According to the report, the economic slowdown will be more pronounced in advanced economies. The US is expected to grow by 1.6% in 2023, while the euro area is expected to grow by 0.8%. The IMF forecasts Chinese economic growth of 5.2% this year, the country with the best forecast. The IMF has also corrected its estimate for Russia's economic growth. After a 2.1% decline last year, Russia's economy is expected to grow by 0.7% in 2023.
According to the IMF's new forecasts, the Romanian economy will slow from a 4.8% advance in 2022 to 2.4% in 2023, before accelerating to 3.7% next year. The Fund predicts that by the end of this year, Ukraine's GDP will fall by 30%.
At the same time, according to the International Monetary Fund report, Moldova's economy will grow by two percent this year and 4.3% in 2024.
According to IMF forecasts, the average annual inflation in Moldova in 2023 will be about 14 percent and in 2024 about 5 percent.
