WASHINGTON, OCT 23 – The global war against inflation has largely been won – and with very little impact on economic growth, the International Monetary Fund (IMF) announced yesterday.
In its latest assessment of the global economy, the IMF predicts that inflation worldwide will decrease from 6.7 percent last year to 5.8 percent this year and to 4.3 percent in 2025.
It estimates that inflation will fall faster in the world’s rich countries, from 4.6 percent last year to 2.6 percent this year and the 2 percent target range for most major central banks – in 2025.
Declining inflation, after years of high price increases due to the COVID-19 pandemic, prompted the Federal Reserve and European Central Bank to cut interest rates this year after they aggressively raised interest rates in an effort to tame inflation.
“The fight against inflation is almost won,” Pierre-Olivier Gourinchas, the IMF’s chief economist, told reporters yesterday.
“In most countries, inflation hovers close to the central bank’s target.”
“Decreasing inflation without a global recession is a major achievement,” Gourinchas wrote in a blog post accompanying the IMF’s latest World Economic Outlook.
Yesterday, in addition to projecting a more moderate inflation outlook, it increased its economic expectations for the United States (US) this year, while lowering
its estimates for growth in Europe and China.
The IMF left its forecast for global growth unchanged at 3.2 percent for 2024. – AP
