IMF chief expects to keep 2023 global growth forecast steady at about 2.7%
The International Monetary Fund is not likely to downgrade its forecast for 2.7 percent growth in 2023, the head of the global lender said on Thursday, noting that a feared oil price spike had failed to materialize and labor markets remained strong.
IMF Managing Director Kristalina Georgieva said 2023 would be another "tough year" for the global economy, and inflation remained stubborn, but she did not expect another year of successive downgrades like those seen last year, barring unexpected developments.
The IMF in October forecast that global growth would slow to 2.7 percent in 2023 after falling from 6.0 percent in 2021 to 3.2 percent in 2022. It had previously forecast growth of 2.9 percent for 2023, but Georgieva said she did not expect further cuts to the outlook.
"Growth continues to slow down in 2023," she told reporters at the IMF's headquarters in Washington. "The more positive piece of the picture is in the resilience of labor markets. As long as people are employed, even if prices are high, people spend and that has helped the performance."
She added that the IMF did not expect major downgrades, although the final number had not been determined. "That's the good news."
Georgieva said the IMF expected the slowdown in global growth to "bottom out" and "turn around towards the end of '23 and into '24."
"We are now in a more shockprone world and we have to be open-minded that there could be a risk turn that we are not even thinking about," she said. "That's the whole point of the last years. The unthinkable has happened twice."
She cited concerns about growing social unrest in Brazil, Peru and other countries, and the impact of tightening financial conditions remained unclear.
But inflation remained "stubborn" and central banks should continue to press for price stability, she added.