Global Growth Will Be Disappointing in 2016 Says IMF’s Lagarde

December 30, 2015 Share Print 0

Global economic growth will be “disappointing” next year, the head of the International Monetary Fund said in a guest article for German newspaper Handelsblatt published on Wednesday.

IMF Managing Director Christine Lagarde said the prospect of rising interest rates in the United States and an economic slowdown in China were contributing to uncertainty and a higher risk of economic vulnerability worldwide.

In addition, growth in global trade has slowed considerably and a decline in raw material prices is posing problems for economies based on these, while the financial sector in many countries still has weaknesses and financial risks are rising in emerging markets, Lagarde added.

“All of that means global growth will be disappointing and uneven in 2016,” Lagarde said, adding that low productivity, aging populations and the effects of the global financial crisis were putting the brakes on growth.

She said the start of normalization of U.S. monetary policy and China’s shift toward consumption-led growth were “necessary and healthy” changes but needed to be carried out as efficiently and smoothly as possible.

Reuters

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Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA

Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.