Jakarta, CNBC Indonesia – Ahead of the G20 summit meeting in Bali, the International Monetary Fund (IMF) has again issued an unfavorable forecast. The bleak outlook for the global economy is getting worse.
This was announced by the agency, which reflects on the worsening of the survey of purchasing managers in recent months, well below expectations.
These conditions further weighed on sluggish economic growth due to monetary policy tightening triggered by high inflation, weak growth momentum in China, continued supply disruptions and food insecurity caused by Russia’s attack on the Ukraine.
The global lender last month cut its 2023 global growth forecast to 2.7% from 2.9% previously.
in a blog preparing for the G20 summit in Bali, the IMF said recent high-frequency indicators “confirm that the outlook is bleaker”, particularly in Europe.
He said the recent Purchasing Managers’ Index measuring manufacturing and services activity signaled weakness in most major G20 economies, with economic activity set to contract, while inflation remains elevated.
“Readings for the growing share of G20 countries have fallen from the expansion zone earlier this year to levels signaling contraction,” the IMF said. ReutersMonday (14/11/2022).
The IMF added that the current global fragmentation has added to existing risks.
“The challenges facing the global economy are enormous and weaker economic indicators point to further challenges ahead,” the IMF said, adding that the current political environment is highly uncertain.
As is well known, a worsening energy crisis in Europe will seriously damage growth and increase inflation, while sustained high inflation could lead to larger-than-expected interest rate hikes and further tightening of global financial conditions.
This increases the risk of a debt crisis for countries with vulnerable economic conditions.
The IMF added that worsening weather conditions would also disrupt world economic growth.
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