The International Monetary Fund (IMF) has warned that global growth remains moderate, with “uneven prospects” across the main countries and regions.
Compared with 2014, it says the outlook for advanced countries is improving, but growth in emerging and developing economies is projected to be lower.
It says there will be weaker prospects in 2015 for some oil-exporting nations.
The IMF’s World Economic Outlook said growth was likely to be 3.5% this year, in line with its January forecast.
Despite the sluggish outlook for 2015, it said growth in emerging markets is expected to pick up in 2016, which will drive an increase in global growth next year to 3.8%.
The outlook document is the IMF’s bi-annual analysis and projections of economic developments. It also publishes further interim forecasts.
It foresees varying fortunes for Brazil, Russia, Ukraine – all contracting this year – and India, which will experience growth of 7.5% this year and next.
“The outlook for Brazil is affected by a drought, the tightening of macroeconomic policies, and weak private sector sentiment, related in part to the fallout from the Petrobras investigation,” said the IMF, adding that the country’s economy is projected to contract by 1% this year, more than two percentage points below the body’s October 2014 forecast.
“The growth forecasts for Russia reflect the economic impact of sharply lower oil prices and increased geopolitical tensions,” it added.
“For other emerging market commodity exporters, the impact of lower oil and other commodity prices on the terms of trade and real incomes is projected to take a toll on medium-term growth.”
Russia’s economy is now expected to contract by 3.8% this year – a downward revision of 0.8 percentage points since January – and by 1.1% in 2016.
It also says that neighbouring Ukraine’s economy is expected to bottom out in 2015, “as activity stabilises with the beginning of reconstruction work”, with the economy projected to contract by 5.5%.
Inflation this year is forecast at 33.5%, reflecting currency depreciation.
Improved financial markets
Meanwhile, the eurozone economy is projected to grow by 1.5% this year and 1.6% in 2016.
UK growth is forecast as 2.7% for 2015, unchanged from the IMF’s January forecast, and 2.3% next year, revised down by 0.1%.
“In the United Kingdom, lower oil prices and improved financial market conditions are expected to support continued steady growth,” said the IMF.
There is no change to the forecast for China, namely a continued slowdown to 6.8% this year and 6.3% in 2016.
The US is seen as growing by 3.1% in 2015 and 2016, down 0.5 and 0.2 percentage points on the previous forecasts.