Stronger downside risks, including China’s change of growth model, lower commodity prices, and “asynchronous” monetary policy around the world prompted the International Monetary Fund (IMF) to lower its global growth outlook, IMF Managing Director Christine Lagarde told Yahoo Finance editor-in-chief Andy Serwer at the World Economic Forum in Davos, Switzerland.
The IMF pared its global growth forecast to 3.4% in 2016, a decline of 0.2% from the agency’s prior estimate in October. Lagarde warned of consequences as the world faces weaker growth.
“There will be fewer jobs created around the world, and there will be countries that will struggle, particularly those suffering from the double downside risks, which is the trade relationship with China slowing down a bit and lower commodity prices,” said Lagarde. “This will affect some of the emerging market economies and low income countries that are vastly commodity export dependent.”
A collapse of the world economy wouldn't signal the end of the world. It would just mean that there would be a new world economy. What this new world economy would consist of, is the question...
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