The International Monetary Fund (IMF) has revised up its global GDP forecasts, noting the economy is “recovering faster than previously anticipated”, having been battered over the past two years. The IMF is now forecasting 3.9% growth this year (up three quarters of a percentage point from its Oct-2009 outlook) and 4.3% growth in 2011.
“But the recovery is proceeding at different speeds around the world, with emerging markets, led by Asia relatively vigorous, but advanced economies remaining sluggish and still dependent on government stimulus measures”, the IMF said in an update to its World Economic Outlook, published on 26-Jan-2010.
“For the moment, the recovery is very much based on policy decisions and policy actions. The question is when does private demand come and take over. Right now it’s ok, but a year down the line, it will be a big question,” said IMF Chief Economist, Olivier Blanchard.
IMF Managing Director Dominique Strauss-Kahn has warned that countries risk a return to recession if anti-crisis measures are withdrawn too soon.
The US economy is expected to grow 2.7% in 2010 and 2.4% in 2010, while the Euro area growth is likely to be more muted, at 1.0% and 1.6% this year and next, respectively.
UK finally out of recession - just
Separately, the UK Office for National Statistics reports the UK economy recorded 0.1% growth in 4Q2009, finally emerging from a deep recession that began in 2Q2008. The 4Q2009 figure was below market consensus and concerns remain the economy could slide back into recession.
Latest IMF GDP growth projections (% change year-on-year)