Growth slowdown concentrated in advanced economies: IMF

Chief Economist Pierre-Olivier Gourinchas said restrictions imposed by India on exports of certain varieties of rice are likely to exacerbate volatility on food prices

While the International Monetary Fund (IMF) has upgraded India's growth forecast for the current financial year it has said that the slowdown in growth this year will be concentrated to advanced economies

In its ‘World Economic Outlook’ projections released on Tuesday, it projected global growth to slow from last year’s 3.5 per cent to 3 per cent this year and the next -- a 0.2 percentage points upgrade for 2023 from IMF’s April projections. In advanced economies, including the US, countries in the European Union and the UK, the IMF said the growth will fall from 2.7 per cent in 2022 to 1.5 per cent this year and is estimated to be subdued at 1.4 per cent next year.

“The euro area, still reeling from last year’s sharp spike in gas prices caused by the war, is set to decelerate sharply,” IMF said in its Outlook report.

In contrast, growth in emerging markets and developing economies is still expected to pick-up with a year-on-year growth expected to accelerate from 3.1 per cent in 2022 to 4.1 per cent this year and the next.