IMF to cut world growth forecasts

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The Independent Online

The International Monetary Fund is set to cut its forecast for global growth next month, the head of the IMF said yesterday.

"We continue to project a gradual recovery, but global growth will likely be a bit weaker than we had anticipated even in July, and our forecast has trended downward over the last 12 months," the IMF's managing director, Christine Lagarde, said in a speech previewing the IMF/World Bank meetings in Tokyo in October.

In July, the IMF cut its global growth projection for 2013 to 3.9 per cent, but left its 2012 forecast unchanged at 3.5 per cent.

Ms Lagarde said uncertainty over the debt crisis in the eurozone was the greatest risk to the world economy, but the possibility of a "fiscal cliff" of automatic government spending reductions in the US was also a "serious" risk.