IMF cuts global forecast, says risks rising
WASHINGTON (AFP) - The IMF slashed its global growth forecast and warned things could get much worse if the euro zone crisis is not quelled and Washington fails to reverse the looming "fiscal cliff" austerity plan.
Unrelenting market turbulence and budget-cutting in developed countries has spun worries about risks across the globe, slowing trade and investment, the International Monetary Fund said in a report released on Tuesday in Tokyo.
The Fund cut its growth forecast for this year to 3.3 per cent, from its July estimate of 3.5 per cent, with Asia still leading the pack of expanding regions while Europe contracts an expected 0.4 per cent this year.
Growth will only hit 3.6 per cent next year - lower than the 3.9 per cent predicted in July - as even powerful emerging economies like China, India and Brazil hit the brakes, the Fund said.