The International Monetary Fund (IMF) has cut its growth forecast for the global economy for 2012.
In a new report the fund predicts growth of 3.3% this year and 3.6% in 2013.
There is some good news for Ireland however.
Experts are predicting ours will be the only Eurozone economy likely to post any growth this year as we begin what they have described as a ‘bumpy recovery’.
The World Economic Outlook (WEO) presents the analysis and projections of the IMF economic developments at the global level in major country groups and in many individual countries.
It says structural reforms will be important in boosting growth and fostering global demand rebalancing “while reducing associated vulnerabilities”.
Using Ireland as an example, the outlook says that inflation in Germany and the Netherlands would have to be about 3 to 4% to keep Euro area inflation close to the ECB target of “below but close to 2%,” if inflation in Greece, Ireland, Italy, Portugal, and Spain were kept around zero to 1% and inflation elsewhere remained in line with the ECB target.
The report adds that activity in Europe contracted by about ¼ percent during the first half of 2012 and that the main new development was a further escalation of financial stress during the 2nd quarter in the Euro area periphery, which despite some easing did not fully reverse in the 3rd quarter through mid-September.
It believes the impact is most  direct in these economies themselves and all except Ireland are now in recession.
But it says spillovers are increasingly reaching other economies in the region “given strong trade and financial linkages”.
Read the report in full href="http://www.imf.org/external/pubs/ft/weo/2012/02/pdf/text.pdf">here
Watch the IMF press conference on the report here:
id="flashObj" width="486" height="412" classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=9,0,47,0"> name="movie" value="http://c.brightcove.com/services/viewer/federated_f9?isVid=1" /> name="bgcolor" value="#FFFFFF" /> name="flashVars" value="videoId=1886926679001&playerID=45533486001&playerKey=AQ~~,AAAACofWkTk~,d-cWVfCeeBH2u4-MzWQrjKX5_f_MoDWg&domain=embed&dynamicStreaming=true" /> name="base" value="http://admin.brightcove.com" /> name="seamlesstabbing" value="false" /> name="allowFullScreen" value="true" /> name="swLiveConnect" value="true" /> name="allowScriptAccess" value="always" /> src="http://c.brightcove.com/services/viewer/federated_f9?isVid=1" bgcolor="#FFFFFF" flashVars="videoId=1886926679001&playerID=45533486001&playerKey=AQ~~,AAAACofWkTk~,d-cWVfCeeBH2u4-MzWQrjKX5_f_MoDWg&domain=embed&dynamicStreaming=true" base="http://admin.brightcove.com" name="flashObj" width="486" height="412" seamlesstabbing="false" type="application/x-shockwave-flash" allowFullScreen="true" swLiveConnect="true" allowScriptAccess="always" pluginspage="http://www.macromedia.com/shockwave/download/index.cgi?P1_Prod_Version=ShockwaveFlash">
Related stories
href="http://www.newstalk.ie/2012/news/lagarde-hopeful-imf-reforms-in-place-by-october/">Lagarde: Hopeful IMF reforms in place by October
href="http://www.newstalk.ie/2012/news/imf-wants-property-tax-twice-as-high-as-government/">IMF wants property tax twice as high as government
href="http://www.newstalk.ie/2012/news/finance-minister-rejects-imf-advice-on-household-charge/">Finance Minister rejects IMF advice on household charge
