Every country has their own economy, but the links between these countries creates a global economy. Countries trade with each other a lot and give aid to countries in crisis. Not to mention the fact that currency holds a major role, with many countries using the dollar and euro. No cryptocurrencies yet, though, but we’ll get there in the next few decades. For this reason, the IMF, or International Monetary Fund, exists. It’s an organization composed of 190 countries, and they work towards making the global economy stable through a monetary system. There are issues with that system, but that’s not what we are here to talk about.
On Tuesday, the IMF released their forecast for the global economy, and there is a lot to unpack. First, they lowered their growth forecast due to supply chain issues in major countries like the United States and China, and the impact of the Delta variant on economies around the world. Along with that, they raised their inflation outlook as prices are rising rapidly and supply chain issues aren’t doing anything to help that. For large economies, they are expecting 5.9 percent growth compared to 6 percent a few months ago, but emerging market economies are expected to grow at a rate of 6.4 percent compared to 6.3 percent. As stated previously, large economies have supply chain issues to straighten out, but emerging markets are doing well as they export commodities a lot, and those have been performing very well. The IMF stressed that the most important policy governments need to focus on is to vaccinate people in their country to prevent COVID mutations and outbreaks as that is the base problem, and large economies need to provide vaccines to the world so that the globe can get vaccinated as a whole. Developing countries still need vaccines, and the number of vaccines being unused in the US is way too much. With how it’s looking, the vaccine can not only save your life, but the economy too. What do you think about the IMF forecast?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.