IMF hikes U.S. growth forecast for 2023, leaves global outlook unchanged
- The International Monetary Fund raised its U.S. growth projection for this year by 0.3 percentage points compared with its July update, to 2.1%.
- It lowered its euro zone forecast by 0.2 percentage points, to 0.7%.
- The U.S. has seen stronger business investment and resilient consumption, the IMF’s World Economic Outlook says, while euro zone economies have diverged under pressure from higher interest rates.
- The IMF also reiterated a global growth forecast of 3% for the year.
———
The International Monetary Fund on Tuesday released its latest World Economic Outlook, which revised its forecast for U.S. growth higher while predicting slower expansion for the euro zone.
The IMF raised its U.S. growth projection for this year by 0.3 percentage points, compared with its July update, to 2.1%. It hiked next year’s forecast by 0.5 percentage points, to 1.5%.
Its euro area growth forecast for 2023 was revised down by 0.2 percentage points to 0.7%, meanwhile, and for 2024 was lowered by 0.3 percentage points to 1.2%.
It attributed the U.S. upgrade to stronger business investment in the second quarter, resilient consumption growth amid a tight labor market, and an expansionary government fiscal stance. Growth is nonetheless expected to slow in the second half of 2023 and into 2024, it added, due to slower wage growth, dwindling pandemic savings, tight monetary policy and higher unemployment.
