IMF raises global growth forecast to 5.5% for '21, warns of “exceptional uncertainty”

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IMF raises global growth forecast to 5.5% for '21, warns of “exceptional uncertainty”

On Tuesday, the Washington-based sister organization of World Bank, International Monetary Fund (IMF) that primarily focuses on fostering global economic growth, had issued a statement saying the pandemic driven fiscal downturn last year, which has been the largest peacetime contraction in global economy since the era of Great Financial Depression, would be a full percentage point lower than initially estimated and that the global economy would more likely to witness a brighter outlook in 2021.

Aside from that, while the latest IMF global growth forecast for 2021 came as a breather for a number of G20 economies across the globe which have still been battling the pandemic-driven fiscal drawdowns, the International Monetary Fund had raised its 2021 forecast for global economic growth.

Besides, IMF, one of the world’s largest lenders, had been quoted saying in the statement that the approvals of multiple vaccines alongside a kickstart of an inoculation process had stepped up hopes of an end to a pandemic-propelled fiscal downturns, however, IMF had also raised an alarming bell over the fate of global economy adding that a number of major economies would continue to face “exceptional uncertainty”.

On top of that, latest IMF statement that predicted a global growth of 5.5 per cent this year, an approximated 0.3 per cent higher than the reading forecasted on October, had also added that the world’s largest economy, the United States, was expected to grow by 5.1 per cent this year, an upward movement of two percentage points on an adjusted basis.

US pledge to fund COVAX marks “very big step,” says IMF’s Gopinath

Meanwhile, adding that the US President Joe Biden’s pledge to finance the World Health Organization’s COVAX initiative had marked up a “very big step” and his proposed $1.9 trillion in fresh pandemic stimulus bill in effect would brighten outlook further for a faster recovery, IMF Chief Economist Gita Gopinath said in a press conference, “Much more will be needed, because as we can see, given the mutating virus, that this is not a problem that’s going away anytime soon.

Concomitantly, in a separate interview with a press agency, Gopinath said late in the day, “There is still a tremendous amount of uncertainty. We know that the health crisis is not over until it’s over everywhere”.