IMF predicts global growth will pick up pace

In its latest World Economic Outlook, published earlier this month, the IMF noted that the recovery in the world economy remains in a low gear. It estimated that global growth averaged only 2.5% in the first half of 2013, roughly the same pace as the second half of 2012.

However, the drivers of global activity are changing. Growth has picked up in most advanced economies this year, but slowed in many emerging economies, which are coming off cyclical peaks. In particular, there has been a notable slowdown in Brazil, Russia, India, and China over the past couple of years.

The IMF expects that growth in advanced economies will continue to strengthen gradually in 2014 and 2015. This anticipated improvement in activity will be primarily driven by a reduced drag from fiscal tightening and the ongoing highly accommodative stance of monetary policy.