IMF maintains 2019 GDP outlook

While the International Monetary Fund (IMF) has revised down its outlook on the global economy and the growth estimates for advanced economies, its view on Korea remains unchanged.

It is still forecasting 2.6 percent growth for 2019.

The fund said Tuesday the world is facing a number of risks. China’s economy is slowing, tension over trade continues, the Eurozone is losing momentum and emerging markets are looking increasingly weak.

Due to these and other factors, the IMF forecasts global economic growth for this year at 3.3 percent, 0.4 percentage points lower than the forecast made in October.

Advanced economies are expected to grow 1.8 percent, down 0.3 percentage points, while emerging markets are likely to expand 4.4 percent, 0.3 percentage points lower than the previous forecast.

The U.S. economy is expected to grow 2.3 percent, 0.2 percentage points less than previously forecast, while the Eurozone is likely to grow 1.3 percent, down 0.6 percentage points down from the earlier IMF report.

The report also cited the tightening of monetary policies and political uncertainties, such as the possibility of a no-deal Brexit and financial troubles in Italy.

The view for Asia wasn’t so bad.

Korea’s growth outlook remained the same as it was in October - at 2.6 percent - while the outlook for China and Japan were both upped 0.1 percentage points, to 6.3 percent and 1 percent respectively.

The IMF forecast closely matched the Korean government’s target, which is for growth of between 2.6 percent and 2.7 percent. The Organization for Economic Cooperation and Development shares the IMF’s view.

Moody’s recently adjusted its outlook from 2.7 percent to 2.5 percent, while the Korea Economic Research Institute lowered its outlook from 2.7 percent to 2.4 percent.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]