WASHINGTON: The global war against inflation has largely been won — and at surprisingly little cost to economic growth, the International Monetary Fund declared Tuesday.
In its latest assessment of the global economy, the IMF predicted that worldwide inflation will cool from 6.7 percent last year to 5.8 percent this year and to 4.3 percent in 2025. It estimates that inflation will fall even faster in the world’s wealthy countries, from 4.6 percent last year to 2.6 percent this year and 2 percent — the target range for most major central banks — in 2025.
The slowdown in inflation, after years of crushing price increases in the aftermath of the pandemic, led the Federal Reserve and the European Central Bank to cut interest rates this year after they had aggressively raised them to try to tame inflation.
“The battle against inflation is almost won,″ Pierre-Olivier Gourinchas, the IMF’s chief economist, told reporters Tuesday. ”In most countries, inflation is hovering close to central bank targets.″
Inflation had accelerated when the world economy recovered with unexpected speed from the COVID-19 recession, leaving factories, freight yards, ports and businesses overwhelmed with customer orders and creating shortages, delays and higher prices. The high borrowing rates engineered by major central banks, along with the end of supply chain logjams, brought inflation dramatically down from the four-decade highs it hit in mid-2022.
And to the surprise of forecasters, the economy — especially the largest, in the United States — continued to grow and employers kept hiring despite higher borrowing costs.
“The decline in inflation without a global recession is a major achievement,” Gourinchas wrote in a blog post that accompanied the IMF’s latest World Economic Outlook.
The IMF, a 190-nation lending organization, works to promote economic growth and financial stability and reduce global poverty. On Tuesday, besides sketching a milder inflation outlook, it upgraded its economic expectations for the United States this year, while lowering its estimates for growth in Europe and China. The IMF left its forecast for global growth unchanged at a relatively lackluster 3.2 percent for 2024.
The IMF expects the US economy to expand 2.8 percent this year, down slightly from 2.9 percent in 2023 but an improvement on the 2.6 percent it had forecast for 2024 back in July. Growth in the United States has been led by strong consumer spending, fueled by healthy gains in inflation-adjusted wages.
Next year, though, the IMF expects the US economy to decelerate to 2.2 percent growth. With a new presidential administration and Congress in place, the IMF envisions the nation’s job market losing some momentum in 2025 as the government begins seeking to curb huge budget deficits by slowing spending, raising taxes or some combination of both.
The IMF expects China’s economic growth to slow from 5.2 percent last year to 4.8 percent this year and 4.5 percent in 2025. The world’s No. 2 economy has been hobbled by a collapse in its housing market and by weak consumer confidence — problems only partly offset by strong exports.
The 20 European countries that share the euro currency are collectively expected to eke out 0.8 percent growth this year, twice the 2023 expansion of 0.4 percent but a slight downgrade from the 0.9 percent the IMF had forecast three months ago for 2024. The German economy, hurt by a slump in manufacturing and real estate, isn’t expected to grow at all this year.
Now that interest rates are coming down and likely to aid the world’s economies, the IMF warned, the need to contain enormous government deficits will likely put a brake on growth. The overall world economy is expected to grow 3.2 percent in both 2024 and 2025, down a tick from 3.3 percent last year. That’s an unimpressive standard: From 2000 through 2019, before the pandemic upended economic activity, global growth had averaged 3.8 percent a year.
The IMF also continues to express concern that geopolitical tension, including antagonism between the United States and China, could make world trade less efficient. The concern is that more countries would increasingly do business with their allies instead of seeking the lowest-priced or best-made foreign goods. Still, global trade, measured by volume, is expected to grow 3.1 percent this year and 3.4 percent in 2025, improving on 2023’s anemic 0.8 percent increase.
Gourinchas also suggested that economic growth could end up being weaker than expected if countries take steps to reduce immigration, which has helped ease labor shortages in the United States and other advanced economies. And he said armed conflicts, like those in Ukraine and the Middle East, could also threaten the economic outlook.
India’s economy is expected to 7 percent this year and 6.5 percent in 2025. While still strong, that pace would be down from 8.2 percent growth last year, a result of consumers slowing their spending after a post-pandemic boom.
The IMF predicts that Japan’s economy, hurt by production problems in the auto industry and a slowdown in tourism, will expand by a meager 0.3 percent this year before accelerating to 1.1 percent growth in 2025.
The United Kingdom is projected to register 1.1 percent growth this year, up from a dismal 0.3 percent in 2023, with falling interest rates helping spur stronger consumer spending.
IMF’s view: Global fight against high inflation is ‘almost won’
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IMF’s view: Global fight against high inflation is ‘almost won’
- The IMF predicted that worldwide inflation will cool from 6.7 percent last year to 5.8 percent this year and to 4.3 percent in 2025
- The global financial institution estimates that inflation will fall even faster in the world’s wealthy countries
Singapore’s long-ruling party on track for landslide win
- Supporters of the PAP, which had ruled Singapore since 1959, gathered at a stadium waving flags and cheering in an early celebration
SINGAPORE: Singapore’s long-ruling People’s Action Party is on track to win another landslide in Saturday’s general elections, according to a sample count of votes released by the Election Department.
The sample count showed the PAP in strong leads in 82 out of 97 seats, which gives it a total 87 seats in an enlarged parliament.
The opposition Workers Party maintained 10 seats. The sample count was not conclusive, but has mirrored final results in the past.
It marked an improvement for the PAP, which secured 83 seats in 2020 polls. It also will bolster Prime Minister Lawrence Wong in his first electoral test since taking office a year ago. A final result was expected in the early hours of Sunday.
Supporters of the PAP, which had ruled Singapore since 1959, gathered at a stadium waving flags and cheering in an early celebration.
Gabon swears in ex-junta chief Oligui as president
- The main concerns are an aging electricity network, which suffers frequent power cuts, youth unemployment that hovers at 40 percent, poor or lacking roads, and a ballooning public debt, forecast to hit 80 percent of GDP this year
AKANDA, Gabon: Gabon began swearing in on Saturday President-elect Brice Oligui Nguema, who led a coup ending decades of Bongo family rule and swept polls last month with nearly 95 percent of the vote.
The general and former junta leader, who toppled Ali Bongo in August 2023, ending 55 years of dynastic rule by the Bongo family, officially takes the presidential reins after leading a 19-month transition government.
Some 20 African heads of state arrived for the inauguration ceremony at a stadium north of the capital, Libreville, while supporters decked out in T-shirts and flags bearing Oligui’s likeness packed out the 40,000-capacity venue.
BACKGROUND
Some 20 African heads of state arrived for the inauguration ceremony at a stadium north of the capital, Libreville.
Leaders in attendance include Gambia’s Adama Barrow, Senegal’s Bassirou Diomaye Faye, Djibouti’s Ismail Omar Guelleh, and Teodoro Obiang Nguema Mbasogo from Equatorial Guinea.
The Democratic Republic of Congo’s president, Felix Tshisekedi, likewise entered around midday.
Tickets were free to attend the investiture at the Angondje stadium, built to honor the friendship between Gabon and China.
It marks the country’s first swearing-in ceremony for such a large audience.
From the morning, the roads of the capital, Libreville, and around the Angondje stadium were clogged with traffic, AFP journalists saw.
On the program for the ceremony was a series of artistic performances and a military parade, according to state media, which will be followed by a “victory concert” on the Libreville waterfront in the evening.
In the lead-up, hundreds of workers have been painstakingly cleaning and repainting areas around the main roads leading to the stadium.
Authorities and official media have called for people to be public-spirited because of the influx of foreign guests.
“All citizens of Greater Libreville are asked to extend a warm welcome to these distinguished guests,” the Interior Ministry said in a statement.
It called on residents near the stadium to “take part in cleaning and beautifying” the area.
Oligui, 50, faces serious challenges in leading the oil-rich country, which needs to revamp crucial infrastructure and diversify its economy, but is heavily indebted.
The main concerns are an aging electricity network, which suffers frequent power cuts, youth unemployment that hovers at 40 percent, poor or lacking roads, and a ballooning public debt, forecast to hit 80 percent of GDP this year.
During the transition, Oligui portrayed himself as a “builder,” launching numerous construction projects, while vowing to “crack down” on corruption to get the country back on track.
Over 45,000 affected by Somalia flash floods
- “The flooding swept away homes and inundated crops, disrupting livelihoods in one of Somalia’s most agriculturally vital regions,” OCHA noted
NAIROBI: More than 45,000 people have been affected by flash floods in Somalia since mid-April, the UN said, with at least four people killed in the rapidly rising waters.
The Horn of Africa is one of the regions most vulnerable to climate change, and extreme weather events are becoming increasingly frequent and intense. “Since 15 April, flash floods due to heavy to moderate rains in Somalia have affected over 45,000 people and swept away four people, including two children and a woman,” said UN humanitarian agency OCHA, in a report published on April 30.
It warned the flooding came at a time when NGOs — often the frontline responders — are “facing crippling funding reductions that have severely limited their ability to respond to emerging needs.”
It detailed that roughly 6,000 people were displaced in the Middle Shabelle region after the Shabelle River burst its banks on April 29.
It said families have sought refuge in makeshift camps on higher ground but are “facing acute shortages of food, clean water, and health care.”
“The flooding swept away homes and inundated crops, disrupting livelihoods in one of Somalia’s most agriculturally vital regions,” OCHA noted.
The day before, some 9,500 people were also displaced in central Galmudug State after light to moderate rains caused flash floods, it said. The floods come as the international humanitarian community grapples with the US decision to dismantle much of USAID, the country’s main foreign development arm.
“Currently, many humanitarian organizations in areas where the flash flooding is occurring have been forced to pause, scale back, or even close their critical programs,” OCHA noted.
Intense floods hit Somalia in 2023. More than 100 people were killed and over a million were displaced after severe flooding caused by torrential rains linked to the El Nino weather pattern.
Zelensky says won’t play Putin ‘games’ with short truce
- “This is more of a theatrical performance on his part. Because in two or three days, it is impossible to develop a plan for the next steps to end the war,” Zelensky said
- He said Ukraine would not be “playing games to create a pleasant atmosphere to allow for Putin’s exit from isolation on 9 May“
KYIV: Ukrainian President Volodymyr Zelensky has dismissed a three-day truce ordered by Russian leader Vladimir Putin as theatrics, but said Kyiv was ready for a full ceasefire.
Moscow said the truce, set to coincide with its World War II commemorations on May 9, was aimed at testing Kyiv’s “readiness” for long-term peace, accusing Zelensky of making a “direct threat” to events on the holiday.
The Kremlin rejected an unconditional 30-day ceasefire proposed by Kyiv and Washington in March, and Putin has since offered little to end the three-year Russia invasion.
“This is more of a theatrical performance on his part. Because in two or three days, it is impossible to develop a plan for the next steps to end the war,” Zelensky said.
He was speaking Friday to a small group of journalists including AFP in remarks embargoed until Saturday.
Some in Ukraine have criticized the truce as an attempt to prevent Kyiv from disrupting the World War II anniversary celebrations, with foreign leaders due in Moscow to watch a military parade on Red Square and an address by Putin.
Zelensky said Ukraine would not be “playing games to create a pleasant atmosphere to allow for Putin’s exit from isolation on 9 May.”
Kremlin spokesman Dmitry Peskov told reporters the ceasefire was aimed at testing “Kyiv’s readiness to seek ways to achieve long-term sustainable peace.”
Russian shelling killed two people in Ukraine’s eastern Donetsk region on Saturday, while a drone strike on the southern Ukrainian city of Kherson left one other person dead, regional officials said.
Russian authorities meanwhile accused Ukraine of an overnight attack on the southern port city of Novorossiysk, damaging apartment buildings and injuring five people.
Leaders of around 20 countries, including China’s Xi Jinping, have accepted invitations to join the May 9 celebration, according to the Kremlin.
Zelensky said some countries had approached Kyiv to warn they were traveling to Russia and had requested safety.
“Our position is very simple toward all countries that have traveled or are traveling to Russia on May 9 — we cannot take responsibility for what is happening on the territory of the Russian Federation,” he said.
“They are ensuring your safety,” Zelensky said, adding that Russia “may take various steps on its part, such as arson, explosions, and so on and then blame us.”
Zelensky did not say what Ukraine would do during the truce, but Russia jumped on the comments, accusing Kyiv of making a “direct threat” to the commemorations.
“He is threatening the physical safety of veterans who will come to parades and celebrations on the holy day,” foreign ministry spokeswoman Maria Zakharova said on Telegram. “His statement... is, of course, a direct threat.”
Russian officials have promised grand celebrations for the occasion, during which Putin will seek to rally support for his troops fighting in Ukraine.
Russian troops have been making gruelling gains on several parts of the front, as both Moscow and Kyiv have stepped up their aerial attacks.
The United States has warned it could abandon efforts to broker a ceasefire if it does not see progress.
Washington is seeking “a complete, durable ceasefire and an end to the conflict,” rather than a “three-day moment so you can celebrate something else,” US State Department spokesperson Tammy Bruce said this week.
Bruce said it would ultimately be up to Trump to decide whether to move ahead with diplomatic efforts.
Trump has overhauled US policy toward Russia since taking office, initiating a rapprochement with the Kremlin.
This culminated in an on-camera clash between Trump and Zelensky at the White House on February 28, where both leaders had been set to sign a mineral deal granting US access to Ukrainian resources in exchange for some protection.
Ukraine has since renegotiated the deal, which would see Washington and Kyiv jointly develop and invest in Ukraine’s critical mineral resources.
Zelensky on Friday said the deal was beneficial to both sides and protected Ukraine’s interests, even though the accord offers no concrete security guarantees for Kyiv.
That followed a meeting between Trump and Zelensky at the end of April before Pope Francis’s funeral at the Vatican, the first encounter since their public clash.
“We had the best conversation out of all those that preceded it,” Zelensky said Friday.
“I am confident that after our meeting in the Vatican, President Trump began to look at things a little differently.”
Serbia’s President Vucic cuts short US visit and returns home after falling ill
- Vucic suddenly fell ill during a meeting in the US
- He was admitted to the Belgrade Military Hospital upon arrival
BELGRADE: Serbia’s President Aleksandar Vucic has cut short a visit to the United States and returned to Serbia over an unspecified health emergency, state RTS television reported on Saturday.
Vucic suddenly fell ill during a meeting in the US and decided to return home after consulting doctors, the report said. He was admitted to the Belgrade Military Hospital upon arrival, it added.
Vucic was previously in Miami, Florida, where he had met with former New York City mayor Rudy Giuliani. Vucic had said he also was hoping to meet with US President Donald Trump.
Richard Grenell, US presidential envoy for special missions, expressed hope that Vucic would recover. “Sorry to miss you but hope all is ok,” Grenell wrote on X.
It was not immediately clear what happened and Vucic’s office said they will inform the public later. Vucic, 55, is known to have high blood pressure.
Serbia’s populist leader also has said he would travel to Russia later this month to attend a Victory Day parade in Moscow, despite warnings from European Union officials that this could affect Serbia’s bid to join the bloc.
