IMF raises world economic growth forecast to 5.2pc

FE Team | Published: July 27, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

WASHINGTON, July 26 (Agencies): The International Monetary Fund (IMF) yesterday revised upward its forecast for global growth in 2007 to 5.2 per cent, compared to the 4.9 per cent pace previously estimated, with projections for China, Germany, India and Russia marked up substantially.
It also expects world economy to expand 5.2 per cent in 2008, 0.3 percentage points higher than projected in April 2007.
"The global economy continued to expand at a brisk pace in the first half of 2007," said the IMF in a revision of its World Economic Outlook (WEO) published in April.
"Emerging market countries have led the way, with China growing by 11.5 per cent in the first half of 2007, and India and Russia also growing very strongly," the IMF said.
The IMF forecasts the US economy to grow at 2.0 per cent pace this year, 0.2 percentage points lower than projected in April, and at a 2.8 per cent pace next year, unchanged from its April prediction.
"Although growth in the United States slowed in the first quarter, recent indicators suggest that the economy regained momentum in the second quarter," the institution said, predicting a "return to potential by mid-2008."
Japan, the second-biggest economy in the world, is expected to see its economy expand 2.6 per cent in 2007 and 2.0 in 2008, up 0.3 percentage point and 0.1 point respectively from the April WEO.
Meanwhile, the 27-nation Eurozone will see the economy grow at a faster rate of 2.6 per cent this year and 2.5 per cent in 2008, up 0.3 point and 0.2 point, respectively.
Germany, Europe's largest economy, sees a growth pace of 2.6 per cent in 2007 and 2.4 per cent in 2008, up 0.8 point and 0.5 point respectively.
The IMF also forecasts a 2.0 per cent rise in consumer prices in the advanced economies in 2007, up 0.2 points, and a 5.7 per cent increase in emerging market and developing countries.
Meanwhile, China's economy is set to expand 11.2 per cent this year and become the largest driver of world growth, the International Monetary Fund (IMF) said yesterday as part of a revised global outlook.
The IMF raised its 2007 forecast a hefty 1.2 percentage points from its World Economic Outlook (WEO) published in April.
The pace of growth in China was expected to moderate to 10.5 per cent in 2008, but higher by 1.0 point than the April forecast, the IMF said.