IMF to lower global economic growth forecast

Updated: 2011-12-02 10:50


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WASHINGTON - The International Monetary Fund (IMF) said on Thursday it would revise down the global economic growth pace next month as the financial turmoil triggered by the eurozone debt crisis was weighing on world economic output.

"The global recovery remains unbalanced and bumpy," Gerry Rice, an IMF spokesperson, told reporters at a regular news briefing, adding that in recent months "there has been more of a slowdown in economic activity especially as we all know in Europe."

"The turmoil in the financial market is also contributing to further uncertainty about the economic forecast," added Rice, also acting director of IMF's External Relations Department.

"We will have our forthcoming World Economic Outlook (WEO) updates toward the end of January next year probably and we will likely be revising downward the forecast to reflect these developments," he noted, without giving further details.

In IMF's flagship WEO report released in September, the global lender projected that global economy would grow at a slower pace of 4 percent in 2011, 0.3 percentage point lower than its projection in June.

Asked whether the US economy still faces a double-dip recession risk, he said that "our forecast is not for a double-dip recession."

Rice noted that the IMF Managing Director Christine Lagarde has commended the latest joint efforts taken by the six major central banks to help ensure that banks have access to needed foreign currency liquidity to support financial stability and market operations.

Six major central banks from advanced economies including the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the US Federal Reserve and the Swiss National Bank Wednesday announced coordinated actions to provide liquidity support to ease global financial strains.

"They come at a time of significant stress in US dollar funding markets in Europe and elsewhere, and they have eased the terms on which US dollars are provided to the market, and they extend those facilities to other major currencies," he added.