IMF lowers India's growth estimate to 4.8% for 2019

IMF lowers India's growth estimate to 4.8% for 20
The International Monetary Fund (IMF) on Monday trimmed back its 2020 global growth forecasts due to sharper-than-expected slowdowns in India and other emerging markets but said a US-China trade deal was another sign that trade and manufacturing activity may soon bottom out.

India saw a sharp 1.2% point cut to its 2020 growth forecast to 5.8% -- the IMF’s biggest markdown for any emerging market -- because of the domestic credit crunch.  Monetary and fiscal stimulus is expected to lift India’s is expected to lift India’s growth rate back to 6.5% in 2021, although this is still 0.9% point lower than forecast in October, IMF said on Monday.

The IMF also said it marked down growth forecasts for Chile due to social unrest and Mexico, due to continued weakness in investment. The Fund said that an easing of tensions between the United States and China, which had stunted GDP growth in 2019, had boosted market sentiment, amid "tentative" signs that trade and manufacturing were bottoming out.

Further, the IMF upgraded China's 2020 growth forecast by 0.2% point to 6.0% because the US trade deal included a partial tariff reduction and cancelled tariffs on Chinese consumer goods that had been scheduled for December. These tariffs had been built into the IMF's previous forecasts.

Source: Media reports

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