The International Monetary Fund offers a muted growth forecast for the world economy.
The world economy absorbed more bad news Monday: The International Monetary Fund cut its growth forecast for 2019. And China, the world’s second-biggest economy, said it had slowed to its weakest pace since 1990.
The IMF cut its estimate for global growth this year to 3.5 percent, from the 3.7 percent it had predicted in October and down from 2018′s 3.7 percent. The fund cited heightened trade tensions and rising interest rates.
“After two years of solid expansion, the world economy is growing more slowly than expected and risks are rising,” said IMF Managing Director Christine Lagarde as she presented the forecasts at the World Economic Forum in Davos, Switzerland.
The IMF is not alone in its pessimism. The World Bank, the Organization for Economic Cooperation and Development and other forecasters have also downgraded their world growth estimates.
Among the key concerns is the Chinese economy. The country is slowing just as its leadership tries to turn it into a more modern economy by reducing its reliance on manufacturing and exports and increasing consumer spending.
