In News
- Recently, the International Monetary Fund released World Economic Outlook, October 2022: Countering the Cost-of-Living Crisis.
Major Findings
- Globally
- Global economic activity is experiencing a broad-based and sharper-than-expected slowdown, with inflation higher than seen in several decades.
- The cost-of-living crisis, tightening financial conditions in most regions, Russia’s invasion of Ukraine, and the lingering COVID-19 pandemic all weigh heavily on the outlook.
- Global growth is forecast to slow from 6.0 percent in 2021 to 3.2 percent in 2022 and 2.7 percent in 2023.
- India : It trimmed its FY23 growth forecast for India by 60 basis points from its July projection of 7.4% to 6.8%
- IMF expects India’s retail inflation to shoot up to 6.9% in FY23 before easing to 5.1% in the next fiscal, compared with 5.5% in FY22.
Suggestions
- Monetary policy should stay the course to restore price stability, and fiscal policy should aim to alleviate the cost-of-living pressures while maintaining a sufficiently tight stance aligned with monetary policy.
- Structural reforms can further support the fight against inflation by improving productivity and easing supply constraints, while multilateral cooperation is necessary for fast-tracking the green energy transition and preventing fragmentation.
Source:TH
