In an updated report released today, the International Monetary Fund reduced its forecast for global GDP growth to 3.6% in 2014 and 3.7% in 2015.
This is down from 3.7% and 3.8%, respectively, which were the estimates published in January.
“The latest incoming data suggest a slight moderation in global growth in the first half of 2014,” the IMF wrote. “The stronger-than-expected acceleration in global activity in the latter part of 2013 was partly driven by increases in inventory accumulation that will be reversed.”
The revisions were driven by sharp downgrades for Russia and Brazil.
The IMF’s forecast for Russia was slashed to 1.6% in 2014 and 2.5% in 2015, down 0.6 percentage points and 0.2 points, respectively. The IMF’s Brazilian forecast was cut to 2% in 2014 and 2.9% in 2015, down 0.5 points and 0.2 points, respectively.
Overall, however, the economy appears to be going in the right direction.
“Global activity strengthened during the second half of 2013 and is expected to improve further in 2014 — 15,” the IMF said. “The impulse has come mainly from advanced economies, although their recoveries remain uneven. With supportive monetary conditions and a smaller drag from fiscal consolidation, annual growth is projected to rise above trend in the United States and to be close to trend in the core euro area economies.”
Here’s a summary of the IMF’s projections: