IMF World Forecast 2022

The International Monetary Fund has just released its World Economic Outlook on January 25, 2022. Global economic growth is expected to slow down in 2022, according to new IMF estimates, World GDP is expected to moderate from 5.9% in 2021 to 4.4% in 2022, half a percentage point lower for 2022 than in the October projection.

With supply chain disruptions and high energy prices continuing in 2022, inflation is expected to persist for longer than expected. Assuming inflation expectations stay well anchored, inflation should gradually decrease as supply-demand imbalances wane in 2022 and monetary policy in major economies responds.

IMF lowered the 2022 GDP forecast of the United States by 1.2 percentage points, from 5.2% to 4%. Other advanced economies are also expected to slow down their growth: IMF revised the projections for Italy (from 4.2 to 3.8%), Germany (from 4.6% to 3.8%), Spain (from 6.4% to 5.8%), and Canada (from 4.9% to 4.1%). Japan’s 2022 growth outlook is revised up by 0.1 percentage point (from 3.2% to 3.3%).

The 2022 forecast downgrade also reflects revisions among a few large emerging markets. In China, the growth forecast for 2022 has changed from October by 0.8 percentage points and 9% in India (upward by 0.5 percentage point), while for the largest five ASEAN economies (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) the growth is revised down by 0.2 percentage point to 5.6%.