HomeNewsIMF forecasts Pakistan’s GDP growth will increase to 2.5pc in ongoing FY

IMF forecasts Pakistan’s GDP growth will increase to 2.5pc in ongoing FY

ISLAMABAD-The International Monetary Fund (IMF) has projected that Pakistan’s GDP growth would increase to 2.5 percent while inflation would decline in the current fiscal year.
In its World Economic Outlook report published on Tuesday, the IMF has estimated Pakistan’s GDP growth rate at 2.5 percent for the ongoing financial year, which was negative 0.5 percent in the previous fiscal year. Meanwhile, inflation rate will fall from 29.2 percent in 2023 to 23.6 percent in 2024. The current account deficit will rise from 0.7 percent to 1.8 percent in 2024. According to the report, unemployment rate in Pakistan to fall from 8.5 percent to 8 percent in the current year.
According to the IMF, the baseline forecast is for global growth to slow from 3.5 percent in 2022 to 3.0 percent in 2023 and 2.9 percent in 2024, well below the historical (2000–19) average of 3.8 percent. Advanced economies are expected to slow from 2.6 percent in 2022 to 1.5 percent in 2023 and 1.4 percent in 2024 as policy tightening starts to bite. Emerging market and developing economies are projected to have a modest decline in growth from 4.1 percent in 2022 to 4.0 percent in both 2023 and 2024. Global inflation is forecast to decline steadily, from 8.7 percent in 2022 to 6.9 percent in 2023 and 5.8 percent in 2024, due to tighter monetary policy aided by lower international commodity prices. Core inflation is generally projected to decline more gradually, and inflation is not expected to return to target until 2025 in most cases.
Monetary policy actions and frameworks are key at the current juncture to keep inflation expectations anchored. Chapter 2 documents recent trends in inflation expectations at near- and medium-term horizons and across agents. It emphasises the complementary role of monetary policy frameworks, including communication strategies, in helping achieve disinflation at a lower cost to output through managing agents’ inflation expectations. Given increasing concerns about geo-economic fragmentation, Chapter 3 assesses how disruptions to global trade in commodities can affect commodity prices, economic activity, and the green energy transition.

Source: nation.com.pk

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