IMF raises global economic growth forecast on US resilience

The International Monetary Fund has raised its global growth forecast for 2024, citing resilience in the US economy and other factors.

However, it also warned of risks to growth from geopolitical shocks, including recent attacks on ships in the Red Sea. It cites China's property woes as another concern.

The IMF's latest world economic outlook released on Tuesday expects the global economy to grow by 3.1 percent this year. That's up 0.2 percentage points from its last projection in October.

The IMF said the revision reflects strength in the US economy, despite higher interest rates. It also cites fiscal support in China to stimulate domestic demand and resilience in developing economies.

The report notes that the global economy is bouncing back from the COVID-19 pandemic, Russia's invasion of Ukraine and the cost-of-living crisis. Inflation is falling faster than expected from its 2022 peak.

The IMF says that a soft landing for the global economy, or taming inflation without causing a recession, now looks more likely.

As for risks, the IMF says that attacks on shipping in the Red Sea could cause supply disruptions and push up commodity prices. This would in turn prolong tight monetary policies.

The IMF projects Japan's economic growth will decelerate from an estimated 1.9 percent in 2023 to 0.9 percent in 2024. This is due to the fading of post-pandemic pent-up demand and the outlook that the yen may strengthen this year.