In Its Recent 2021 Economic Forecast, IMF Is Quite Optimistic About the Economy
The global rebound is expected in 2021, according to the IMF’s economic forecasts for 2021. At the same time, this may be somewhat hindered by the task of administering the Covid-19 vaccines.
An index forecast that was presented on Tuesday, predicts that the global economy will expand by 6% in 2021, which is up from the previous forecast of 5.5%. Looking even further, global GDP is expected to grow by 4.4% in 2022.
In the latest World Economic Outlook report, the IMF chief economist Gita Gopinath said that the way out of the current health and economic crisis is becoming increasingly visible, even with high uncertainty about the path of the pandemic. This year’s new wave of economic stimulus and vaccination rollouts have helped boost the global economy’s confidence. At the same time he cautioned that the forecast speaks about wide differences in the pace of recovery and economic harm from the crisis.
The International Monetary Fund expects emerging economies to develop by a combined 5.1% for the year, with the United States moving up by 6.4%. The group predicts 6.7 percent growth for emerging and developed economies in 2021, with India will at a rate of up to 12.5 percent.
In developed and developing countries, wage inequality is predicted for young people and others with poorer qualifications, although that’s an additional problem in emerging economies as well.
As a result, the IMF says that policymakers should maintain fiscal stimulus measures to promote “escape from the crisis.” It went on to say that in the second process, “policymakers would need to reduce long-term economic scarring” caused by the recession and increase public spending. “Without increased measures to give everybody a fair chance, cross-country living standards disparities could grow dramatically, and decades-long patterns of global poverty reduction could reverse,” Gopinath said.
According to the current projections, the United States will see a strong economic rebound in 2021, while most of the rest of the world will take longer to rebound to pre-crisis levels. “Among advanced economies, the United States is predicted to exceed its pre-Covid GDP level this year, although many others will only do so in 2022,” Gopinath said.
President Joe Biden’s $1.9 trillion coronavirus rescue kit, which went into effect last month, played a big role in the favorable appraisal for the US.
Unemployment in the United States is expected to decline from 8.1 percent in 2020 to 5.8 percent this year and 4.1 percent in 2022. According to the IMF’s new predictions, the United States is on track to not only recover but to outperform its pre-pandemic results this year.
Treasury Secretary Janet Yellen stated in February that the United States could return to full jobs in 2022. She told CNN at the time, “There’s just no excuse that we should go through a long, painful recovery.”