In a speech at the University of Hong Kong, IMF Managing Director Christine Lagarde expressed her optimism on the global economy. She said the “economic picture is “mostly bright” and “the sun is still shining”. Global momentum is driven by “stronger investment”, “rebound in trade” and “favorable financial conditions”. She said the forecast to be release next week will “continue to be optimistic”.
Regarding advanced economies, Lagarde said Eurozone’s upswing is “now more widely spread across the region”. US growth will “likely accelerate further due to expansionary fiscal policy”. In Asian emerging markets, China and India lead by “rising exports and higher domestic consumption. But she also warned of “darker clouds looming”. Momentum in 2018 and 2019 will eventually slow because of “fading fiscal stimulus” in the US China, rising interest rates and tighter financial conditions.
Lagarde emphasized three priorities for the global economy, including 1. Steering clear of Protectionism, 2. Guard against Fiscal and Financial Risk, 3. Foster Long-term Growth that Benefits Everyone.
