TAIPEI CITY, Taiwan, January 22, 2019 (Newswire.com) - On Monday, the International Monetary Fund (IMF) downgraded its global growth forecast citing the possibility of a no-deal Brexit and a greater than anticipated economic slowdown in China and the Eurozone as reasons for its gloomier predictions.
The IMF’s global growth forecast was downgraded to 3.5 percent for this year and 3.6 percent for next year. The organization cautioned that economic weakness seen in the later months of 2018 would likely spill over to the first half of this year.
Findlay Nicolson analysts say the ongoing trade tensions between the United States and China, manifesting in a trade war that raged on for the better part of 2018, have already hit the world’s economic prospects hard and the IMF has warned that a further slowdown in China’s economy could continue to damage sentiment and hurt global growth prospects.
China recently reported that its economy had grown at the slowest pace since the financial crisis a decade ago in the final quarter of last year. Analysts at Findlay Nicolson reported that the world’s second-largest economy saw a decline in imports and exports in December last year as US President Donald Trump’s punitive tariffs hurt exports and domestic demand waned.
The possibility of the UK leaving the European Union without a deal poses a significant threat to the health of the Eurozone economy. UK Prime Minister Theresa May recently suffered a devastating defeat in the House of Commons as her Brexit deal proposal was overwhelmingly rejected. May now faces an uphill battle as she attempts to coax the European Union into agreeing to further concessions regarding the Irish backstop clause.
Source: Findlay Nicolson