The IMF said that this year will be bad, but it is being accused of being too optimistic.
According to Reuters, “The global economic downturn will be considerably deeper than even the International Monetary Fund forecast a month ago, the Organization for Economic Co-operation and Development’s chief economist Klaus Schmidt-Hebbel said.
The OECD believes that IMF projections that global GDP will grow .5% this year worldwide are well off the mark. The organization also said it thinks this quarter will be the worst of the downturn.
That, of course, is a guess, and a bad one at that. Unemployment in developed nations is almost certainly to grow because of losses at businesses. If exports from China continue to slow, that huge economy could begin to post negative GDP. If credit remains locked down in the US and Europe, the second and third quarters could get much worse than the first.
Nice guess. No dice.
Douglas A. McIntyre
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