Global Economic Uncertainty Remains High

At the third G20 Finance Ministers and Central Bank Governors meeting, International Monetary Fund (IMF) First Deputy Managing Director Gita Gopinath highlighted the persistent high levels of global economic uncertainty. Downside risks continue to dominate the outlook, signaling potential challenges ahead.

New Dynamics in Global Trade

Gopinath reiterated the IMF's April forecast but pointed out new dynamics, including strong evidence of front-loading ahead of tariff increases and some trade diversion. These developments come amid heightened tensions in global trade, though certain trade deals have helped lower average tariffs, improving financial conditions.

Inflation Trends and Future Projections

On the topic of inflation, Gopinath noted a general cooling trend, attributed to weakening demand and falling energy prices. However, she cautioned that the situation varies significantly across countries. The IMF is set to update its global growth projections by the end of July, offering more insights into the economic outlook.