‘Strong’ outlook for US growth: IMF | 2019-03-24 | daily-sun.com

‘Strong’ outlook for US growth: IMF

24 March, 2019 12:00 AM printer

WASHINGTON: The International Monetary Fund on Thursday said the US economic outlook remained “strong,” a day after the Federal Reserve trimmed its median growth forecasts for the year.

“We believe the outlook for the US economy is strong with historically low unemployment, high levels of business and consumer confidence helped by the fiscal expansion that’s underway,” spokesman Gerry Rice told reporters, reports AFP.

The Washington-based crisis lender is due to publish updated global growth forecasts on April 9. And Rice said the IMF would have more to say on the US economy at that time, in addition to reports on trade and tariffs.

Last year, the United States began a trade war with China, and the world’s two largest economies have since exchanged tariffs on more than $360 billion in two-way goods trade.

While the sums involved are comparatively small, the IMF and many economists warn the trade war could have larger ripple effects, denting the global economy.

On Wednesday, the Federal Reserve lowered its 2019 US growth forecast to 2.1 percent, down from a 2.3 percent estimate in December, which was also a downward revision.

However, Fed Chairman Jerome Powell told reporters the central bank’s outlook was still “a positive one.”

The most recent IMF forecast for the United States calls for GDP growth of 2.5 percent. And Rice said the multilateral institution also approves of the Fed’s current monetary policy decisions.

The Fed’s median estimate now calls for no interest rate increases at all this year, after four increases in 2018, but this is subject to revision. “Given the range of global uncertainties facing the US economy we support the Fed’s decision to be patient in determining future changes to the federal funds rate,” Rice said Thursday.

He also said the Fed’s self-declared data dependence and clear public communication would help “minimize any market disruptions and spillovers from its policy decisions.”