Worldwide economic prospects have dimmed this year as countries have faced higher living costs, tighter financial conditions and increased uncertainty following Russia’s invasion of Ukraine.
The crises have dulled the rebound from the Covid pandemic, even as Asia has remained a ‘relative bright spot’ compared with other parts of the globe, the IMF said in its Regional Economic Outlook.
The IMF cut Asia’s growth forecast to 4.0% this year and 4.3% next year, down 0.9% point and 0.8 point from April, respectively. The slowdown follows a 6.5% expansion in 2021.
The growth of Bangladesh would reach 7.2% in the 2022 calendar year and then it would see a gradual decline in 2023 and 2024. Growth would stand at 6% in 2023 and then rise to 6.5% in 2024, it noted.
The IMF expects China’s growth to slow to 3.2% this year, a 1.2-point downgrade from its April projection, after an 8.1% rise in 2021. The world’s second-largest economy is seen growing 4.4% next year and 4.5% in 2024, the IMF said.
As Asian emerging economies are forced to raise rates to avoid rapid capital outflows, a ‘judicious’ use of foreign exchange intervention could help ease the burden on monetary policy in some countries, the IMF said.
