October 12
International Monetary Fund has projected that global growth will decelerate from 6 percent in 2021 to 3.2 percent in 2022 and 2.7 percent in 2023. This is the weakest growth profile since 2001, except for the global financial crisis and the COVID-19 pandemic’s acute phase.
IMF Report says, ‘Global economic activity is experiencing a broad-based and sharper-than-expected slowdown, with inflation higher than seen in several decades. The cost-of-living crisis, tightening financial conditions in most regions, Russia’s invasion of Ukraine, and the lingering COVID-19 pandemic all weigh heavily on the outlook’.
The IMF predicted that India will remain on track to become one of the world’s fastest-growing economies despite lowering its GDP growth forecast to 6.8 percent for Financial Year 2022 and 6.1 percent for Financial Year 2023. In 2021, India’s growth was 8.7 percent.
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IMF further added, Global inflation is forecast to rise from 4.7 percent in 2021 to 8.8 percent in 2022 but to decline to 6.5 percent in 2023 and to 4.1 percent by 2024. Monetary policy should stay the course to restore price stability, and fiscal policy should aim to alleviate the cost-of-living pressures while maintaining a sufficiently tight stance aligned with monetary policy. Structural reforms can further support the fight against inflation by improving productivity and easing supply constraints, while multilateral cooperation is necessary for fast-tracking the green energy transition and preventing fragmentation.
