IMF: Outlook for World Economy Better Due to Corona Support Biden

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The outlook for the world economy has been enhanced by President Joe Biden’s US corona support package and progress with vaccination campaigns in several countries.

 

Kristalina Georgieva of the International Monetary Fund (IMF) said this in a speech. According to her, the fund will therefore revise its forecasts for the world economy upwards.

In January, the Washington organization thought that the global economy could grow by 5.5 percent again this year, after the 3.5 percent contraction last year. A plus of 4.2 percent was forecast for 2022. Georgieva announced that the picture now looks better for both 2021 and 2022. That means faster recovery from the corona crisis, but the precise figures will not be released until next week’s spring forecast.

That not only the United States benefits from Biden’s corona support, and several economists have recently indicated. For example, experts at credit insurer Euler Hermes called the $ 1,900 billion package “fuel for the entire world economy” because the money, which they say is almost literally scattered across the US, is likely to boost international trade.

Georgieva noted in her speech that there is still “extremely high uncertainty”, including financial circumstances from an economic point of view. “Accelerated recovery generally brings good news, but it can also lead to less desirable results,” she warned. Faster recovery of the US economy could also lead to a rapid rise in interest rates, making borrowing less attractive and unfavourable for many emerging and developing economies.

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