2023.01.3104:21:00UTC+00IMF Lifts Global Growth Outlook

The International Monetary Fund upgraded its global growth outlook for this year as the recent reopening of China is set to safeguard the recovery despite the rise in central bank rates to fight inflation in most advanced economies.

The global growth outlook for 2023 was revised up by 0.2 percentage points to 2.9 percent, the IMF said in its World Economic Outlook Update, released Tuesday. Nonetheless, this was weaker than an estimated 3.4 percent growth in 2022.

The lender projected economic growth to improve moderately to 3.1 percent next year. Global inflation is forecast to ease to 6.6 percent this year and 4.3 percent in 2024. Still inflation remains above pre-pandemic levels of about 3.5 percent, the lender noted.

The IMF observed that the balance of risks remains tilted to the downside, but adverse risks have moderated since the October 2022 World Economic Outlook. While fight against inflation as well as Russia's war in Ukraine will continue to weigh on global economic activity this year, the reopening of China after the lockdowns will pave the way for a faster-than-expected recovery.

In the United States, growth is expected to weaken from 2.0 percent in 2022 to 1.4 percent in 2023 and 1.0 percent in 2024.

Growth in Eurozone is projected to bottom out at 0.7 percent this year before improving to 1.6 percent in 2024. China's economic growth is seen at 5.2 percent in 2023 and 4.5 percent in 2024.