The International Monetary Fund (IMF) has raised concerns about the elevated uncertainty surrounding the global economic outlook, citing the potential impact of elections and policy changes. In its latest World Economic Outlook (WEO) report, titled “Policy Pivot, Rising Threats,” the IMF noted that nearly half of the world’s population is either going to the polls this year or has already done so, increasing the likelihood of significant shifts in trade and fiscal policies.
The report, released on October 22, highlights the risks posed by political transitions, particularly in major economies like the U.S., where the upcoming presidential election could lead to substantial changes in international trade agreements and fiscal policy.
IMF Chief Economist Pierre-Olivier Gourinchas emphasized that such policy shifts could have negative spillover effects on the global economy, increasing volatility and uncertainty. He also pointed out that while the fight against inflation is nearing its end, managing inflation without triggering a global recession has been a significant achievement.
The IMF projects global economic growth to be 3.2% in 2024 and 3.3% in 2025, with Emerging and Developing Asia leading the way. However, Sri Lanka’s specific data was not included due to ongoing discussions on sovereign debt restructuring.
Additionally, oil prices are expected to rise slightly this year, supported by OPEC+ production cuts and geopolitical tensions, while broader fuel commodity prices are forecasted to decline.