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April 22, 2009
Growth Forecasts for 2009-2010 from the IMF
The IMF's World Economic Outlook (Chapter 1), released this morning, is grim:
From the introduction:
The global economy is in a severe recession inflicted by a massive financial crisis and an acute loss of confidence. Wide-ranging and often unorthodox policy responses have made some progress in stabilizing financial markets but have not yet restored confidence nor arrested negative feedback between weakening activity and intense financial strains. While the rate of contraction is expected to moderate from the second quarter onward, global activity is projected to decline by 1.3 percent in 2009 as a whole before rising modestly during the course of 2010 (Figure 1.1). This turnaround depends on financial authorities acting decisively to restore financial stability and fiscal and monetary policies in the world’s major economies providing sustained strong support for aggregate demand.
More discussion later.
Posted by Menzie Chinn at April 22, 2009 06:21 AM
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Comments
Once again, the latest economic projection shows the recession running lower, longer, and recovery later than the last projection.
Why is this the universal (not just consistent) case? Why are economists and economic and business institutions unable to stick with a projection (or even revise it upward!) from one quarter to the next?
Posted by: Terry at April 22, 2009 08:14 AM
Because that is what they are paid for. It is exactly the same for IEA's projections of (always-growing) fossil fuels production, or for CERA's projections of (always-shrinking) crude oil prices.
Posted by: Marco at April 23, 2009 02:03 AM