October 20, 2021

IMF slashes US growth forecast and warns of rising risks to the global economy

The IMF on Tuesday slashed its 2021 growth forecast for the United States by one full percentage point to 6%, the biggest reduction suffered by any G7 economy in its latest World Economic Outlook.

The cut reflects disruptions to supply chains and softening consumption in the third quarter, the IMF said.

The revision comes days after Goldman Sachs cut its growth forecasts for the US economy this year and next, citing weaker consumer spending and the winding down of the government’s Covid-19 relief programs.

The IMF now expects the global economy to grow 5.9% in 2021, 0.1 percentage points lower than the July forecast. The outlook for 2022 remained unchanged. Despite the modest revision, the organization said that economic risks have increased.

“Rapid spread of Delta and the threat of new variants have increased uncertainty about how quickly the pandemic can be overcome,” it said. “Policy…

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