On Friday the forecast of the economic growth of the US was slashed by the IMF as it cautioned Washington and other debt-ridden European countries that unless immediate steps were taken by them for reduction in budget deficits, they would be considered as “playing with fire”. Since its earlier report in April, larger menaces to growth had surfaced, said the IMF, in its regular review of global economic panoramas, alluding to debt crisis in the euro zone and indications of sweltering in budding market economies.
The global lender headquartered at Washington, forecast that U.S. GDP (gross domestic product) would grow a moderate 2.5% this year and 2.7% next year. The forecast it made 2 months back spoke of 2.8% and 2.9% growth expectations respectively. The Fund said in an unhurried tone that the retarded growth of the past few months should be “short-term” considering the overall global
economy.
Drawing attention to 4 countries, Vinals said that the United States, Japan, Ireland and Greece would have to restore their public finances to a bearable condition with relation to debt levels. Greece, an indebted country, is on the verge of non-payment as the officials in the euro zone have disagreed to plan another aid package for it.
For more: International Monetary Fund Slashes Growth Forecast of US, Cautions of Crisis
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