IMF Trims Global Growth Forecast, Warns of Hard Landing

IMF expects global growth of 2.8% this year and 3% in 2024, slightly below its forecasts published in January. IMF said its baseline forecast “assumes that the recent financial sector stresses are contained.”

 IMF stressed that signs of resilience alongside lower global energy and food prices masked a darker reality. Pierre-Olivier Gourinchas, IMF’s chief economist, said: “Below the surface… turbulence is building, and the situation is quite fragile… Inflation is much stickier than anticipated even a few months ago,” he said. “More worrisome is that the sharp [monetary] policy tightening of the past 12 months is starting to have serious side effects for the financial sector.”

“Risks to the outlook are heavily skewed to the downside, with the chances of a hard landing having risen sharply,” the IMF said.