The International Monetary Fund confirms the strength of the global recovery in 2017 and 2018. It lowers its forecasts for the United States and the United Kingdom but is, conversely, more optimistic for the eurozone.
There is no doubt, the recovery is here. For the International Monetary Fund (IMF), the organization that ensures the health of the global economy, the growth announced in April is confirmed. As predicted, global production is expected to register an increase of “3.5% in 2017 and then 3.6% in 2018,” slightly more than last year (3.2%), the IMF is set to indicate this Monday morning during a press conference in Kuala Lumpur, Malaysia.
However, this growth will not be distributed exactly as the institution’s experts thought a few months ago. Two global heavyweights are expected to grow less than anticipated.
In the United States, fiscal and regulatory policies could weigh on growth, now estimated at 2.1% in both 2017 and 2018. In particular, fiscal policy is expected to be “less expansionary” than anticipated. The major infrastructure spending plan and tax cuts promised by Donald Trump have still not been passed by Congress.
In Great Britain, where Brexit, with negotiations only in their early stages, creates significant uncertainties, activity was weaker than expected in the first quarter, and growth projections have been revised downward.
Revisions Upward for the Eurozone
In the eurozone, the opposite is true. “The positive surprises in activity at the end of 2016 and the beginning of 2017 indicate a solid momentum,” highlights the IMF, which estimates that the economic rebound will be stronger in Europe, where political risks have diminished. In Germany (+1.8% in 2017), Spain (+3.1%), France (+1.5%), and Italy (+1.3%) where growth in the first quarter exceeded expectations, domestic demand is more robust than expected.
Finally, Asia is also on the right track, notably China (+6.7%) and Japan (+1.3%).
