IMF Releases Most Pessimistic Economic Projections for the United States to Date
The International Monetary Fund (IMF) estimates that real (inflation-adjusted) gross domestic product (GDP) in the United States will fall by 8 percent in 2020, according to the latest update to their World Economic Outlook report. The new projection is 2.1 percentage points below the previous projection that they released in April. The IMF is more pessimistic than other forecasters about the effect of the coronavirus (COVID-19) on the U.S. economy.
The IMF is also pessimistic about the economies of a number of other countries. For example, they estimate that the economies of both Italy and France will decline by more than 12 percent this year. Meanwhile, the IMF projects that China will experience growth of 1.0 percent in real GDP in 2020, making it one of only two countries (along with Egypt) included in the report to receive a positive projection for the year.
Image credit: Photo by iStock/Getty Images
Further Reading
Can We Grow Our Way Out of the National Debt?
The gap between what economic growth can realistically deliver and what fiscal sustainability requires is too large to bridge without also addressing the structural imbalance between federal spending and revenues.
How Rising National Debt Drives Up Interest Rates — and What That Means for Americans
By adding upward pressure to interest rates, the rising national debt can increase the cost of living for American households.
The Fed Held Its Target Range For the Fifth Meeting in a Row but Interest Costs Remain High
High interest rates on U.S. Treasury securities increase the federal government’s borrowing costs.