/ world today news/ Avoiding a recession in the United States is becoming increasingly difficult, the IMF executive board said. Washington was advised to “repeal the trade restrictions and tariff increases introduced in the past five years.”
The IMF’s report on the results of the traditional annual survey of the US economy said that “the stakes are high when looking for measures on inflation”. Washington has been warned that “choosing the wrong political decisions in one direction or another will lead to significant consequences” both for the United States itself and for the entire world.
According to the IMF, there are factors that “create additional problems”: coronavirus, “difficulties in supplies”, as well as circumstances that the IMF links to the Russian special military operation in Ukraine, reports TASS.
The IMF estimates that the US GDP in 2022 will grow by 2.3%, in 2023 the growth rate is forecast at 1%. So the fund worsened the forecast from its April estimates by 1.4 percentage points this year and by 1.3 p.p. next year. In 2021, according to the IMF, the US economy grew by 5.7%. According to the IMF, the unemployment rate in the US in 2022 will be 3.7% and in 2023 – 4.6%. Inflation is expected to be 6.6% in 2022 and 1.9% in 2023.
It noted that “the longer inflation remains high, the greater the risk of a rise in inflation expectations, which will then affect wages and prices.” As a result, the Fed may have to “take more drastic measures to reduce inflation by raising interest rates and keeping them high for longer,” which “will lead to further slowing of growth and higher unemployment “.
The IMF believes that “the policy priority should be to quickly slow price growth without provoking a recession”, the US should “remove the trade restrictions and tariff increases introduced over the past five years”, and “actively engage with trading partners to strengthen a rules-based economy, a multilateral trading system built around the WTO.”
We recall that the US economy is “dangerously close” to recession, JPMorgan economists said. Analysts at JPMorgan believe that in the second quarter, US GDP will not grow by 2.5%, as they had previously expected, but will show an increase of only 1%, which is close to stagnation. The beginning of a recession can be indicated by the collapse of stock indexes in the United States and high inflation that the United States cannot cope with. By July 1, the US S&P 500 had lost 21% year-to-date, according to Dow Jones estimates. Such a decline is a record since 1970. U.S. stocks have lost $9 trillion in value in the first half of the year, said Kirill Dmitriev, CEO of the Russian Direct Investment Fund.
Translation: PI
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