The global economy will grow more slowly over the next two years, according to the International Monetary Fund’s latest forecast.
And Europe’s financial crisis and a potential budget crisis in the US could slow world growth even further, the IMF warned in a report carried by The Associated Press.
The world economy will likely expand 3.5 percent this year, the IMF said in a quarterly update to its World Economic Outlook.
That’s down slightly from its previous estimate of 3.6 percent in April.
But the IMF said growth in the Middle East will be stronger this year as key oil producing countries boost production and Libya's economy rebounds from conflict in 2011, but it held its forecast for next year at 3.7 percent.
The IMF also cut its forecast for global growth to 3.9 percent in 2013, from 4.1 percent three months ago.
And it shaved its US growth forecast to 2 percent this year from 2.1 percent in April. For 2013, it expects US growth of 2.3 percent, down from 2.4 percent.
On the bright side, forecasts for this year for Germany and Japan were revised higher — to 1.0 percent and 2.4 percent, respectively, though the 2013 prediction for each was also trimmed slightly.
Also getting an upgrade was the Middle East and North Africa region. The IMF said the region would grow about 5.5 percent this year, much better than the 4.2 percent predicted in April.
Global recovery still at risk: IMF
