Published: Tue, April 17, 2018
Worldwide | By Isabel Fisher

International Monetary Fund lowers Moldova's 2018 GDP growth forecast to 3.5%

With growth picking up after falling sharply in the second quarter of 2017 due to "one-off factors", India in 2018 and 2019 would re-emerge as one of the fastest growing major economies, it said.

The IMF kept its 2018 and 2019 global growth forecasts unchanged at 3.9 percent for both years after upgrades in January.

The International Monetary Fund (IMF) has retained its forecast for Ukraine's GDP growth in 2018 at 3.2 percent, while it reviewed downwards the forecast for 2019 to 3.3 percent from 4 percent, according to the World Economic Outlook published on Tuesday.

"A projected increase in India's growth provide some offset to China's gradual slowdown and emerging Europe's return to its lower-trend growth rate", the report said.

Maurice Obstfeld, Economic Counsellor and Director of the Research Department, IMF said that the world economy continues to show broad-based momentum.

This will cause a drop in investment spending and slowing down the United States economy.

"Continuing to power the world economy's upswing are accelerations in investment and, notably, in trade", he said.

"Business confidence is likely to gradually firm up with the change in the political leadership, but growth prospects remain weighed down by structural bottlenecks", the worldwide lender said in its latest World Economic Outlook published in Washington.

"While the medium-term growth outlook for India is strong, an important challenge is to enhance inclusiveness", the report said.

Once the cyclical upswing and USA fiscal stimulus have run their course, prospects for advanced economies remain subdued, given their slow potential growth.

India's projected growth provide some offset to China's gradual slowdown, the International Monetary Fund said.

The IMF said the reforms would improve infrastructure in transport and telecommunication sectors to spur growth.

"In the present global environment, the burden of reducing excess global imbalances should be shared through multilateral action-excess deficit and excess surplus countries alike need to adopt macroeconomic policies that align their spending levels more closely with their incomes", Obstfeld concluded, adding that unfair trade practices should be addressed by strengthening the multilateral trade system rather than by risking fragmentation.

"Fights over trade distract from this vital agenda, rather than advancing it", Obstfeld said.

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