Considerable uncertainty over specific policies: IMF

“Our latest World Economic Outlook assumes fiscal expansion by the US will carry momentum forward, raising US economic growth from 2.3 to 2.5 per cent in 2018, which is positive for the global economy,” Tao Zhang, Deputy Managing Director of the International Monetary Fund, told PTI in an exclusive interview. 

“At the same time, there is considerable uncertainty on specific policies. We are following policy developments closely, and we will need to see details of the various proposals to better understand their implications,” the top IMF official said when asked about the economic policies of the US President Donald Trump. Zhang said although growth is picking up, the world economy still faces many challenges, and risks remain skewed to the downside. 

“These risks include an inward shift in policies and elevated policy uncertainty; an aggressive rollback of financial regulation; and a faster-than-expected tightening of financial conditions. These are risks, not yet certain. We have to see whether they come to pass,” he said. 

“As our Managing Director Christine Lagarde said during the Spring Meetings, we are seeing the global economy picking up momentum,” he added. “Despite some improvement for the US and other advanced economies, most of the global pick-up stems from emerging markets, including India. “The outlook for the Asia Pacific region remains robust- the strongest in the world-and recent data point to a pickup in momentum,” he said.