World prospects strengthening again: IMF

April 17th, 2012

FAKE NEWS for the Zionist agenda

The International Monetary Fund (IMF) expects the Australian economy to expand by three per cent in 2012, as the threat of a sharp global economic slowdown recedes and activity in the United States rises.

In its latest World Economic Outlook, the IMF said that after a major setback in 2011 the world outlook was gradually improving, even though “downside risks remain elevated”.

It modestly upgraded its world growth forecast for 2012 to 3.5 per cent, from a previous prediction of 3.3 per cent in January when it released an update statement. World growth in 2013 is now seen at 4.1 per cent.

“Improved activity in the United States during the second half of 2011 and better policies in the euro area in response to its deepening economic crisis have reduced the threat of a sharp global slowdown,” the fund said on Tuesday.

The Washington-based institution foresees a weak recovery in the major advanced economies with activity expected to remain relatively solid in most emerging and developing economies.

“However, the recent improvements are very fragile,” it says.

“Policymakers need to continue to implement the fundamental changes required to achieve healthy growth over the medium term.”

The IMF has forecast growth for Australia of 3.0 per cent in 2012 and 3.5 per cent for 2013.

The 2012 forecast is unchanged from an IMF briefing note issued in January, although it is down from the 3.3 per cent growth forecast in the previous half-yearly world economic outlook report published in September last year.

Even so, the IMF’s 2012 forecast does reflect a solid rebound from actual growth in 2011.

The most recent domestic national accounts report showed the Australia economy grew at an annual rate of 2.3 per cent in the year to December 2011.

The IMF also expects Australian inflation will return to its two to three per cent target band over this year and next, after reaching 3.4 per cent in 2011, and for unemployment to remain around its current low level of 5.2 per cent.

Otherwise, there was very little specific commentary on Australia in the report.

However, the IMF did note that Australia was in a region where exposure to troubled euro area banks was less than for other parts of the world.

“Nevertheless, banking systems in the region that have the greatest reliance on foreign wholesale funding (including Australia and New Zealand) remain vulnerable to deleveraging in the global financial system,” it says.

Another external risk for Australia was the chance that tensions in the Middle East cause another oil price spike, although the IMF added such a risk appeared manageable.

“But a large external shock could bring these risks to the fore, precipitating a decline in investment and activity on China that would also have implications for its trading partners,” it said.

The IMF expects growth in China – Australia’s number one trading partner – of more than eight per cent both this year and next, as consumption and investment remains robust.