Jiji Press WASHINGTON (Jiji Press) — The International Monetary Fund said Tuesday that it projects the Japanese economy to grow 1.5 percent in 2017, up 0.2 percentage point from its previous forecast released in July.
In its latest World Economic Outlook report, the IMF also raised its growth projection for the world economy by 0.1 point to 3.6 percent, on the back of brighter outlooks mainly for the United States, Europe and China.
In Japan and the eurozone, “stronger private consumption, investment, and external demand bolstered overall growth momentum” in the first half of 2017, the report said.
The 2018 estimate for Japan was revised up by 0.1 point to 0.7 percent. But the rate remained lowest among the advanced economies, due to a falling potential growth rate reflecting the aging and decreasing population.
The IMF also raised its growth estimate for the United States by 0.1 point to 2.2 percent for 2017 and 0.2 point to 2.3 percent for 2018. The changes reflected “very supportive financial conditions and strong business and consumer confidence,” the report said, while it cited the country’s “significant policy uncertainty.”
The IMF warned that the U.S. Federal Reserve’s interest rate hike and tapering of its balance sheet may have a negative impact on emerging markets.
The report revised up its 2017 and 2018 projections for the eurozone.
Meanwhile, the forecasts for Britain, which is leaving the European Union, were unchanged. The country was told to carry out the departure in a way that will not expand its trade barriers.
As for the Chinese economy, the IMF revised up both years’ forecasts, factoring in the nation’s economic stimulus measures and supply-side reforms.
Growth forecasts for Russia and Brazil were also raised, led by increased prices of natural resources.
“The current recovery [of the global economy] is incomplete,” said Maurice Obstfeld, economic counsellor and director of the Research Department at the IMF.