The International Monetary Fund cuts its global growth forecast as uncertainty grows about the future

The International Monetary Fund on Tuesday cut its global growth forecasts for 2022 and 2023, describing the outlook for the global economy as “more bleak and uncertain”.
The International Monetary Fund now expects the global economy to grow 3.2% this year, before the GDP rate slows further to 2.9% in 2023. That’s 0.4% and 0.7% down, respectively, from the Fund’s forecast released in April, According to CNBC.

The Washington-based fund said revised forecasts indicate that the downside risks outlined in its previous report are now materializing, including rising global inflation, a worse-than-expected slowdown in China, and the continuing fallout from the war in Ukraine.
“The temporary recovery in 2021 was followed by increasingly bleak developments in 2022,” the report said. Several shocks have hit a global economy already weakened by the pandemic, including higher-than-expected inflation worldwide that has tightened financial conditions, a worse-than-expected slowdown in China, and the Ukraine crisis.
The projected slowdown is expected to mark the first quarterly contraction in real global GDP since 2020. The International Monetary Fund said there is a “reasonable”, but less likely alternative scenario that could see global growth decline to about 2.6% in 2022 and 2.0 % in 2023, putting global growth in the lowest 10 % of results since 1970.