IMF lifts 2021 global growth forecast

Fund pegs growth at 5.5%, still sees ‘exceptional uncertainty’

Updated - January 26, 2021 11:23 pm IST

Published - January 26, 2021 11:22 pm IST - Washington

Lost ground:  The pandemic has wiped out progress made in reducing poverty over the past 2 decades.

Lost ground: The pandemic has wiped out progress made in reducing poverty over the past 2 decades.

The International Monetary Fund on Tuesday raised its forecast for global economic growth in 2021 and said the coronavirus-triggered downturn in 2020 would be almost a full percentage point less severe than expected.

It said multiple vaccine approvals and the unveiling of vaccinations in some countries in December had boosted hopes of an eventual end to the pandemic.

But it warned that the world economy continued to face ‘exceptional uncertainty’ and global activity would remain well below pre-COVID projections made one year ago. Close to 90 million people are likely to fall below the extreme poverty threshold during 2020-2021, with the pandemic wiping out progress made in reducing poverty over the past two decades.

The IMF forecast a 2020 global contraction of 3.5%, an improvement of 0.9 percentage points from the 4.4% slump predicted in October, reflecting stronger-than-expected momentum in the second half. It predicted global growth of 5.5% in 2021, an increase of 0.3 percentage points from earlier, citing expectations of a vaccine-powered uptick later in the year and added policy support in the U.S., Japan and other large economies.

China, India

The U.S. economy was expected to grow 5.1% in 2021, an upward revision of 2 percentage points attributed to carry over from strong momentum in the second half.

China is expected to expand 8.1% in 2021 and 5.6% in 2022, compared with its October forecasts of 8.2% and 5.8%, respectively, while India’s economy is seen growing 11.5% in 2021, up 2.7 percentage points after a stronger-than-expected recovery in 2020.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in


Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.