IMF downgrades world economic growth forecast

Joe Curtis
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The IMF warned that the ongoing US-China trade war is a risk to global economic growth (Source: Getty)

The International Monetary Fund (IMF) has downgraded the world’s economic growth forecast while warning about risks created by the US and China’s trade war.

The IMF cut its global growth prediction by 0.2 per cent to 3.7 per cent for 2018 and 2019.

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It said the world outlook "is one of less balanced and more tentative expansion”.

"Overall, world economic growth is still solid compared with earlier this decade, but it appears to have plateaued," the IMF said.

The body’s director of research, Maurice Obstfeld, said the US, Mexico and Canada’s replacement Nafta deal has still not been approved, while the UK and EU haven’t agreed a Brexit deal.

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“US tariffs on China and, more broadly, on auto and auto part imports may disrupt established supply chains, especially if met by retaliation,” he added, regarding the US-China trade war.

Yesterday Jaguar Land Rover warned that it would shut a factory down for two weeks to cope for a huge drop in Chinese demand, which it blamed on trade tensions.

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