The Globe and Mail reports in its Wednesday edition that International Monetary Fund managing director Christine Lagarde said on Tuesday that global growth has lost momentum amid rising trade tensions and tighter financial conditions.
A Reuters dispatch to The Globe reports that Ms. Lagarde said the global economy is "unsettled" after two years of steady growth, with the outlook "precarious." In January, the IMF cut its global growth forecast for 2019 to 3.5 per cent from 3.7 per cent, and Ms. Lagarde signalled further cuts when the IMF releases new forecasts next week.
She said: "We had this synchronized acceleration of growth a couple of years ago. Now it is synchronized deceleration and a slowing momentum across the spectrum."
She said that the IMF does not anticipate a recession in the near-term, and the Federal Reserve's "more patient pace of monetary policy normalization" will provide some thrust to growth in the second half of 2019 and into 2020.
She cautioned, however, that years of high public debt and low interest rates since the financial crisis a decade ago have left limited room in many countries to act when the next downturn arrives so countries need to make smarter use of fiscal policy.
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