IMF cuts global growth outlook, cites euro fears
http://www.marketwatch.com/story/imf-cuts-global-growth-outlook-cites-euro-fears-2012-01-24
FRANKFURT (MarketWatch) The International Monetary Fund on Tuesday cut its forecast for global economic growth in 2012 and 2013, citing growing financial strains and rising downside risks as Europes debt crisis entered a perilous new phase.
n an update of its world economic outlook, the Washington-based institution said it expects global output to grow by 3.3% in 2012, down from 3.8% in 2011 and from a September forecast of 4%. Global output is forecast to expand 3.9% in 2013, down from a previous forecast of 4.5%.
Global growth prospects dimmed and risks sharply escalated during the fourth quarter of 2011, as the euro-area crisis entered a perilous new phase, the IMF said.
The IMF said it now expects rising sovereign bond yields and deleveraging by banks to push the euro-zone economy into a mild recession in 2012.