The IMF now forecasts global GDP growth of 3.6% this year, and 3.7% in 2018, with both figures up 0.1%.
“Broad-based upward revisions in the euro area, Japan, emerging Asia, emerging Europe, and Russia more than offset downward revisions for the United States and the United Kingdom,” the IMF said.
The upgrade follows from five years (2013-2017) of routine IMF downgrades of global growth expectations, noted Stewart Robertson, senior economist at Aviva Investors.
“The differences may be quite small, but the fact they are in a positive direction is news in itself. Having got used to regular disappointments, successive growth upgrades are an indication that things are perhaps changing in a good way – the economic expansion has become more entrenched. Solid foundations now provide a sound base for ongoing growth and slow normalisation after ten-years of doubt and setback,” he said.
The IMF stressed, however, that “the recovery is still incomplete”, citing low wage growth across the developed world and “subdued longer-run trends of productivity and demographics”.
The assertion prompted Robertson to mock the fund for its “strange choice of phrase”.
“This suggests that there is a standard template for economic revivals. As any student of economic history will tell you, they are all different,”, he said.