IMF Cuts World Economy Growth Forecast
The International Monetary Fund (IMF) slightly lowered its forecast for the world economic growth in its updated World Economic Outlook report that was released Tuesday at the Washington.
The IMF pegged world economic growth at 3.3 percent for this year and 3.8 percent for 2015. In July, the group had forecasted a 3.4 percent and 4 percent respectively.
The IMF added that though the U.S. posted strong economic growth and the U.K. recovered relatively well from the great recession, many markets were still reeling from the effects of the global slowdown.
The group also asserted that though the political tensions n the Middle East and Ukraine didn't hurt the economy yet, it posed a great threat to future economic growth, the Los Angeles Times reported.
"World growth is mediocre and a bit worse than forecast in July," the IMF said in the report.
"The recovery continues, but it is weak and uneven," IMF Chief Economist Olivier Blanchard was quoted by the Times.
The IMF is also unsure about the Eurozone's performance.
"There is a risk that the recovery in the euro area could stall, that demand could weaken further, and that low inflation could turn into deflation. Should such a scenario play out, it would be the major issue confronting the world economy," Blanchard said of the Eurozone.
"The challenge ... is to go beyond the general mantra of 'undertaking structural reforms' to identify both the reforms that are most needed and the reforms that are politically feasible," Blanchard was quoted by Reuters.
