In place of the growing unpredictability around the world, the International Monetary Fund (IMF) has lowered its projection for economic growth in Nigeria by 0.2 percent, bringing the new estimate down to 3.2 percent. According to the World Economic Outlook (WEO) October update that was announced recently, it estimated that the country’s gross domestic product (GDP) would expand at a rate of 3.2 percent this year and then gradually decrease to three percent in 2023. Both projections are twenty basis points (bps) below what was predicted for July.
However, in July, the Institution decided to keep the projection that they had made in April for this year at 3.4 percent. The Gross Domestic Product of the country increased at a rate of 3.4% in the first quarter of the year (Q1 ’22), but that rate dropped to 3.1% in the second quarter (Q2 ’22). The average performance thus far falls short of the growth forecast for the year that was provided by the Federal Government.
The global economy has been obscured by several factors.
More so, the growth rate for sub-Saharan Africa was also lowered by the IMF, from 3.8 percent to 3.6 percent. Meanwhile the IMF projects that the global economy, which is being hampered by the crisis in the cost of living as well as geopolitical tensions, will expand by 3.2 percent this year and 2.7 percent next year, a significant drop from the six percent increase that was recorded in the previous year.
Current economy of the entire world is at present going through a variety of challenging and chaotic times. The condition is obscured by a number of factors, including inflation that is higher than it has been in several decades, tightening financial circumstances in most regions, Russia’s invasion of Ukraine, and the persistence of the COVID-19 pandemic. As policymakers work to bring inflation back down to its target level, they are normalizing monetary and fiscal policies, which provided unprecedented assistance during the pandemic. This has the effect of reducing demand.
The future economy depends on accurate monetary policy.
According to the IMF, a growing percentage of economies are experiencing a deceleration of growth or a decline. The future of the world economy remains precarious, depending on a number of factors such as the accuracy with which monetary policy is adjusted, the outcome of the conflict in Ukraine, and the likelihood of additional supply-side disruptions in countries like China as a result of pandemics. The world economy is projected to fall from 6% in 2021 to 3% in 2022, and 2.7% in 2023. This dismal economic profile, which includes considerable slowdowns for the greatest economies, is the worst seen since 2001, except for the global financial crisis and the severe phase of the COVID-19 pandemic.
A risk to the forecast that was described as “unusually large” was highlighted in the report. It pointed to the war between Russia and Ukraine as one of the threats battling with growth, along with the normalization of monetary policy and elevated inflation. It issued a warning that monetary policy could make an error in calculating the appropriate level of monetary tightening to bring down inflation. More so, Economists also warned that an excessive tightening of monetary policy by central banks might push the global economy into a deeper decline than was anticipated, which has the potential to cause a severe crisis.
Inflation control should be the priority, says Jerome Powell.
Speaking on the same, Jerome Powell of the Federal Reserve System which led the central bank chiefs, insisted that inflation control should be the priority because they have paid little attention to it. He added that during this week’s World Bank/IMF Annual Meetings, central bankers from throughout the world are facing challenging problems about maintaining the modest growth recorded after the COVID-19 disruption while also preventing excessive inflation. So many more central banks are entangled in monetary tightening, which has stimulated de-risking worldwide. As a result, the safe haven currency and the pound sterling are nearly at parity, as measured by the U.S. Dollar Index, which has reached a level not seen since the early 2000’s. The dollar was trading at 0.97 euros and $1.1 U.S. at the time of publication.
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Fact Checking Tool – Snopes.com
Due to the global economic problems the IMF has projected Nigeria to have a a minimal growth as low as 3.2 in our economic development.
Since there is global economic problem it as make our economic development low such as the war between the two countries and pandemic issue so it really affect our economy
Inflation control should be the priority.Excessive tightening of monetary policy by central banks might push the global economy into a deeper decline than was anticipated, which has the potential to cause a severe crisis.
Every sector in nigeria is affected by the economy of this country. Am not supprise about IMF has downgraded Nigeria’s economic prospects
The International Monetary Fund (IMF) has reduced its forecast for economic growth in Nigeria from 3.3 to 3.2 percent as a result of rising global uncertainty.
As policymakers try to bring inflation back to target, they normalize monetary and fiscal measures that helped during the pandemic. So, demand falls.
A significant proportion of the world’s economies are either slowing their rate of expansion or facing a contraction.
The future of the world economy remains precarious, depending on a number of factors such as the accuracy with which monetary policy is adjusted
The research indicated a “very considerable” predicted risk. The war between Russia and Ukraine, monetary policy normalization, and inflation were cited as dangers to growth.
The IMF has also reduced the growth rate for countries in sub-Saharan Africa, bringing it down from 3.8 percent to 3.6 percent.
It was forecasted that the country’s gross domestic product (GDP) would rise at a rate of 3.2 percent this year, and then progressively fall to three percent in 2023.
The current economy of the entire world is going through a variety of difficult and chaotic periods at the present time, and the condition is clouded by a number of variables.
The average performance up to this point is not in line with the growth prediction for the year that was supplied by the Federal Government.
Central bankers from all over the world are gathered in Washington this week for the annual meetings of the World Bank and the International Monetary Fund (IMF). They are facing difficult challenges as they attempt to maintain the modest growth that was recorded after the COVID-19 disruption while also preventing excessive inflation.
It was forecasted that the country’s gross domestic product (GDP) would rise at a rate of 3.2 percent this year, and then progressively fall to three percent in 2023.
As policymakers work to bring inflation back down to its target level, they are normalizing monetary and fiscal policies, which provided unprecedented assistance during the pandemic.
The ripple effect of the covid-19 and the Ukraine-Russia war still affecting economy around the world. Effective measure should be devise to counter this before it escalate.
From all index that show the development of a nation Nigeria lack 70% of it.IMF is an international organisation body that measure the monetary policy of each countr.
The IMF is very right to downgrade our economic growth. Our GDP is nothing to write home about. The fiscal policies have not borne out profitable income for the economy. Our debt rate is still rising sporadically. I hope we begin to formulate new monetary policies to aid our depleting economy.