Global Economy: Resilience Amid Challenges

The IMF forecasts a slight increase in global economic growth and a decline in inflation for this year, amid uncertainties related to Donald Trump's policy proposals. U.S. economy remains strong, contrasting with slower growth in Europe and China. Economic resilience faces challenges from potential policy-induced risks.

The International Monetary Fund (IMF) projects that the global economy will experience modest growth and a decrease in inflation this year. However, the outlook is complicated by the policies promised by President-elect Donald Trump, including potential tax cuts, tariffs, deregulation, and mass deportations.

The IMF anticipates the global economy to grow at a rate of 3.3% this year and the next, marking a slight improvement from 3.2% in 2024. This growth remains modest compared to the average growth of 3.7% annually from 2000 to 2019. Ongoing repercussions from the COVID-19 pandemic and geopolitical tensions, such as Russia's invasion of Ukraine, continue to affect economic recovery.

The U.S. leads in economic robustness, benefitting from a resilient job market, maintained consumer spending, and eased labor shortages. Yet, potential overheating from Trump's proposed tax cuts and tariffs could increase inflation. Meanwhile, policy adjustments in China and regulatory changes in Europe add to the global economic dynamics.

(With inputs from agencies.)