WASHINGTON: The International Monetary Fund upgraded its outlook for the United States, highlighting its crucial role again as the growth leader among advanced economies as the eurozone and Japan sag. But the IMF also saw risks in the US being caught by a downdraft into stagnation, if the rest of the world cannot find any more gas for growth.
The Fund, in its semi-annual assessment of the world economy, increased its forecast for US growth this year from 1.7 percent in July to 2.2 percent.
The sharp upgrade was no surprise — the previous number overestimated a sustained impact from the sharp January-March contraction this year, when extraordinarily harsh winter weather stalled investment and spending.
The rebound will see growth at about 3 percent for the rest of the year, edging up to 3.1 percent in 2015. “The United States and the United Kingdom in particular are leaving the crisis behind and achieving decent growth,” IMF chief economist Olivier Blanchard said.
Yet, he added, “even for those two countries, potential growth is now lower than in the early 2000s.” AFP
