Citing Russia’s War, IMF Cuts Global Growth Forecast to 3.6%

Citing Russia’s War, IMF Cuts Global Growth Forecast to 3.6%

The International Monetary Fund on Tuesday downgraded the outlook for the world economy this year and next, blaming Russia's war in Ukraine for disrupting global commerce, pushing up oil prices, threatening food supplies and increasing uncertainty already heightened by the coronavirus and its variants.

The 190-country lender cut its forecast for global growth to 3.6% this year, a steep falloff from 6.1% last year and from the 4.4% growth it had expected for 2022 back in January. It also said it expects the world economy to grow 3.6% again next year, slightly slower than the 3.8% it forecast in January.

The war - and the darkening outlook - came just as the global economy appeared to be shaking off the impact of the highly infectious omicron variant.

"The war will slow economic growth and increase inflation," IMF chief economist Pierre-Olivier Gourinchas told reporters on Tuesday.

Now, the IMF expects Russia’s economy - battered by sanctions - to shrink 8.5% this year and Ukraine’s 35%.

US economic growth is expected to drop to 3.7% this year from 5.7% in 2021, which had been the fastest growth since 1984. The new forecast marks a downgrade from the 4% the IMF had predicted at the beginning of the