WASHINGTON (MaceNews) – The International Monetary Fund’s January update to its World Economic Outlook Tuesday saw world growth revised up 0.3 to 5.5%, fueled by a vaccine-propelled recovery.
Last year’s performance benefited from a stronger than previously seen second half and it was revised up 0.9 to a contraction of 3.5%.
U.S. growth was revised up 0.4 to 5.1% for 2021. Euro area growth was marked down a full percentage point to 4.2%. The UK was seen with 4.5% growth this year, 1.4 pts less than projected in October. Japan added 0.8 to reach a 3.1% growth estimate. China got a 0.1 downgrade to maintain an outlook for 8.1% growth, more than doubling that in the U.S. India is higher at 11.5%, given a giant 2.7 point upgrade since October.
Global trade volumes are projected to grow about 8%, despite “subdued cross-border tourism and business travel.”
“The projections continue to rely on economics adapting to social distancing until local transmission in brought to a low level,” the WEO said. It conceded “exceptional uncertainty surrounds the baseline projection” – particularly in Europe. New anti-virus restrictions there “suggest growth could be weaker than projected in early 2021.” The December agreement on the UK’s exist from the EU “has eliminated a key downside risk.”
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