The International Monetary Fund has named as its new chief economist Maurice Obstfeld, an academic and White House economic adviser known for his work on money flows and international finance.
The International Monetary Fund has trimmed its forecast for global economic growth for this year to take into account the impact of recent weakness in the United States. But the global financial institution said growth prospects for next year remain undimmed, despite Greece's debt crisis and recent volatility in Chinese financial markets.
The International Monetary Fund on Thursday said it seemed Greece's crisis and market volatility in China would not affect when the US Federal Reserve chooses to raise interest rates. However earlier in the week the IMF suggested United States delays raising interest rates, warning that economic growth could be significantly debilitated by a soaring greenback.
The IMF's chief economist warned that a default by Argentina in its battle with holders of its defaulted debt may hurt its economy and the global financial system. Argentina continues to face the fallout of its 2001 debt default, which plunged the country into an economic crisis it is still battling to overcome.
The International Monetary Fund has raised its global growth forecast for the first time in nearly two years, saying fading economic headwinds should permit advanced nations to pick up the mantle of growth from emerging markets.
The International Monetary Fund trimmed its forecasts for global output for the sixth time since early last year, saying stronger growth in most advanced economies would fail to make up for a more sluggish expansion in the developing world
The global economic recovery is slowing, with world growth projected at 4% in both 2011 and 2012, down from over 5% in 2010, the IMF said in its latest forecast. And even this lowered projection counts on a lot going well.
Capital flows to emerging markets won’t significantly slow when the US Federal Reserve ends its bond-purchasing program known as quantitative easing, said Olivier Blanchard, chief economist at the IMF.