IMF slightly lowers ’21 global GDP forecast as pandemic lingers

HOUSTON (ICIS)–The International Monetary Fund (IMF) slightly lowered its 2021 global GDP forecast and left its 2022 forecast unchanged as the coronavirus pandemic continues to disrupt supply chains, increasing the risks to economies across the world.

In its World Economic Outlook (WEO), released today, the IMF said the slight reduction in global GDP projections masks large downgrades for some countries, including the group of low-income developing economies which have seen outlooks darken considerably because of worsening pandemic conditions.

“The downgrade also reflects more difficult near-term prospects for the advanced economy group, in part due to supply disruptions,” said IMF chief economist Gita Gopinath.

The global GDP projection was lowered by 0.1 percentage points from its July survey, from 6% to 5.9%.

The WEO is a survey by the IMF staff published twice a year, in the spring and fall.

It is prepared by the IMF staff and has benefited from comments and suggestions by executive directors following their discussion of the report on September 27.

The WEO noted the rate of inflation his risen significantly in the US and in emerging economies but expects price pressures to subside in 2022.

The IMF left its global GDP forecast for 2022 unchanged at 4.9% and said that global GPD is likely to moderate at around 3.3% over the medium term as output from advanced economies is forecast to exceed pre-pandemic projections, based at least in part on the anticipation that the US government will continue to provide policy support in terms of economic stimulus.

The WEO forecast remains subject to substantial upside and downside disruption, with deteriorating prospects for a vaccine and the market panic that could cause standing as the key potential negative influence.

The table below shows GDP projections by country and regions and includes world trade volume, commodity prices, consumer prices, and London Interbank offered rate outlooks.