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International Monetary Fund downgrades outlook for U.S., China as result of trade war

10 October 2018

He admitted that the continent "will witness growth next year but the growing number of working class coupled with less jobs opportunities, huge public debts and poor infrastructure present a challenge in achieving the developmental goals of the United Nations".

The UK economy is expected to grow by 1.4% this year - down from April's prediction of 1.6% - while predicted growth for 2019 remains at 1.5%, a slowdown from 1.7% in 2017.

"It occurs as many economies have reached or are nearing full employment and as earlier deflationary fears have dissipated".

Meanwhile, a few are using the same tweet to term Prime Minister Imran Khan what his party had once called former premier Nawaz Sharif.

The worldwide organisation warned a full-blown trade war between the United States and China could have wider implications for the financial growth around the world. "Growth has proven to be less balanced than hoped". "Not only have some downside risks we identified in the last WEO (World Economic Outlook) been realised, the likelihood of further negative shocks to our growth forecast has risen".

"Going to the International Monetary Fund is a positive trigger because it will remove the underlying causes for concern, which is that government targets will further weaken", said Suleman Maniya, head of research at local brokerage house Shajar Capital.

The US will also see its growth "decline" once its fiscal stimulus, delivered through wide-ranging tax cuts "goes into reverse" according to Mr Obstfeld. -China tariff war's impact to be felt next year, the Fund cut its 2019 US growth forecast to 2.5 percent from 2.7 percent previously, while it cut China's 2019 growth forecast to 6.2 percent from 6.4 percent.

Domestic Chinese policies are likely to prevent an even larger growth decline than the one International Monetary Fund projected, but at the cost of prolonging internal financial imbalances, he said.

Also notably, the Philippines's inflation will be below the median 3.3-percent forecast inflation among emerging and developing Asia five years from now. For 2019 however, the country's 6.6 percent growth forecast tops most countries in ASEAN, closely followed by Vietnam with 6.5 percent while Indonesia is a distant third with 5.1 percent.

With their core inflation rates largely quiescent, advanced economies continue to enjoy easy financial conditions.

He said that the government should try its best to deal with the IMF's demand to further increase the price of gas and electricity and tighten the monetary policy as it would hurt the masses and the economy.

Pakistan might seek Extended Fund Facility (EFF) for 36-month programme and Islamabad will have to undertake hectic lobbying at important world capitals for increasing the size of the funding against the allocated quota of Pakistan into the IMF arrangement and then requesting the Washington based lender for frontloading of the programme.

The IMF also took aim at Brexit in its assessment, as it warned how slow progress in thrashing out an European Union divorce deal for Britain is creating "pervasive uncertainty" about future trade costs.

International Monetary Fund downgrades outlook for U.S., China as result of trade war