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☆ IMF chief economist says central banks' inflation fight to last into 2024
▼ + stars: | 2022-10-11 | by ( Reuters Staff | ) www.reuters.com time to read: 1 min

FILE PHOTO: A man looks at a shop at the Ameyoko shopping district in Tokyo, Japan, May 20, 2022. REUTERS/Kim Kyung-Hoon/FilesWASHINGTON (Reuters) - Central banks’ fight against inflation may take another two years to play out, increasing unemployment and lowering living standards for many in the world, the International Monetary Fund’s chief economist said on Tuesday. In an interview with Reuters, IMF economic counselor Pierre-Olivier Gourinchas said that broad “core” inflation pressures beyond energy and food prices will take time to bring down to central bank targets of about 2%. “Our projection is that this will start coming down, but we will not be back to central bank targets in 2023,” Gourinchas said of inflation. “We’ll be closer to that in 2024.”

Cutting its 2023 global growth forecasts further, the IMF said in its World Economic Outlook that countries representing a third of world output could be in recession next year. The global lender maintained its 2022 growth forecast at 3.2%, reflecting stronger-than-expected output in Europe but a weaker performance in the United States, after torrid 6.0% global growth last year as the COVID-19 pandemic eased. China's growth outlooks also were downgraded as it struggles with continued COVID-19 lockdowns and a weakening property sector, where a deeper downturn would slow growth further, the IMF said. The growing economic pressures, coupled with tightening liquidity, stubborn inflation and lingering financial vulnerabilities, are increasing the risks of disorderly asset repricings and financial market contagions, the IMF said in its Global Financial Stability Report. A man walks past the International Monetary Fund (IMF) logo at its headquarters in Washington, U.S., May 10, 2018.

☆ IMF cuts 2023 growth outlook amid colliding global shocks
▼ + stars: | 2022-10-11 | by ( David Lawder | ) www.reuters.com time to read: +4 min

The Fund is keeping its 2022 growth forecast at 3.2%, reflecting stronger-than-expected output in Europe but a weaker performance in the United States, after torrid 6.0% global growth in 2021. The IMF kept its 2023 U.S. growth forecast unchanged at 1.0%. The Fund forecast headline consumer price inflation peaking at 9.5% in the third quarter of 2022, declining to 4.7% by the fourth quarter of 2023. A "plausible combination of shocks" including a 30% spike in oil prices from current levels could darken the outlook considerably, the IMF said, pushing global growth down to 1.0% next year - a level associated with widely falling real incomes. The appropriate policy for most was prioritizing monetary policy for price stability, letting currencies adjust and "conserving valuable foreign exchange reserves for when financial conditions really worsen."

☆ IMF urges UK to align fiscal policy with BoE inflation goals
▼ + stars: | 2022-10-11 | by ( David Milliken | ) www.reuters.com time to read: +2 min

"Fiscal policy should be aligned with monetary policy," Gourinchas said at a news conference in Washington, when asked about Britain's economic situation and the turmoil in its government bond market. "Central banks are trying to tighten monetary policy, and if you have at the same time fiscal authorities that try to stimulate aggregate demand, it's like having a car with two people in the front ... each trying to steer the car in a different direction. "Now what we've seen in the UK market, we've seen market dysfunction, related to some illiquidity in some segments," Gourinchas said. The IMF published new growth forecasts for Britain on Tuesday, although these were finalised before Kwarteng's Sept. 23 statement. The Fund expects British economic growth to slow to 0.3% next year compared with a July forecast of 0.5% growth for 2023.

☆ Next year is going to feel painful, IMF chief economist says
▼ + stars: | 2022-10-11 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailNext year is going to feel painful, IMF chief economist saysNext year is going to feel painful, IMF Chief Economist Pierre-Olivier Gourinchas tells CNBC's Geoff Cutmore.

☆ There would be a cost for the rest of the world if the U.S. fails to tackle inflation, IMF chief economist says
▼ + stars: | 2022-10-11 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailThere would be a cost for the rest of the world if the U.S. fails to tackle inflation, IMF chief economist saysThere would be a cost for the rest of the world if the U.S. fails to tackle inflation, chief economist at the IMF, Pierre-Olivier Gourinchas, says.

☆ 'The worst is yet to come': IMF issues stark recession warning
▼ + stars: | 2022-10-11 | by ( Julia Horowitz | Cnn Business | ) edition.cnn.com time to read: +1 min

London (CNN Business) The International Monetary Fund has once again downgraded its forecast for the global economy with a sharp warning: "The worst is yet to come, and for many people 2023 will feel like a recession." The agency said Tuesday that it expects global growth to slump to 2.7% next year, with a 25% probability it could fall below 2%. That compares with projected growth of 3.2% this year. The figure for next year is 0.2 percentage points lower than the IMF's July outlook, as Russia's war in Ukraine, high inflation and a slowdown in China drag on activity. The IMF believes that global inflation will peak late this year, but will "remain elevated for longer than previously expected," even as central banks work aggressively to bring it under control.

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