IMF World Economic Outlook (WEO) Update -- An update of the key WEO projections, July 2007

World Economic Outlook, July 25, 2007

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IMF World Economic Outlook (WEO) Update -- An update of the key WEO projections, July 2007

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Bibliographic details

• Published: July 25, 2007
• Series: World Economic Outlook

Global growth outlook

• The strong global expansion is continuing.
• Global growth is projected at 5.2 percent in 2007 and 2008—0.3 percentage point higher for both years than projected at the time of the April 2007 World Economic Outlook.
• The global economy continued to expand at a brisk pace in the first half of 2007.
• United States growth slowed in the first quarter of 2007 but recent indicators suggest the economy regained momentum in the second quarter.
• Emerging market countries continued to expand robustly, led by rapid growth in China, India, and Russia.

Inflation, commodity prices, and monetary policy risks

• Inflation remains generally well contained despite strong global growth, although some emerging market and developing countries have faced rising inflation pressures, especially from energy and food prices.
• Oil prices have risen back toward record highs against the backdrop of limited spare production capacity.
• Food prices have been boosted by supply shortages and increased use of biofuels.
• With sustained strong growth, supply constraints are tightening and inflation risks have edged up since the April 2007 WEO, increasing the likelihood that central banks will need to further tighten monetary policy.
• The risk of an oil price spike remains a concern.
• Financial market risks have increased as credit quality has deteriorated in some sectors and market volatility has increased.

Balance of risks and other considerations

• The overall balance of risks to the global growth outlook remains tilted modestly to the downside.
• Downside risks related to U.S. domestic demand have diminished somewhat despite the ongoing housing sector correction.
• Upside risks to growth in the euro area and emerging market countries discussed in the April 2007 WEO have partially materialized and are built into the baseline projections.
• Some progress has been made toward reducing risks of a disorderly unwinding of global imbalances, although protectionist pressures are a continuing concern.

Key projections and statistics (from Table 1)

• World output: 4.9 (2005); 5.5 (2006); 5.2 (2007); 5.2 (2008); Difference from April 2007 Projections: 0.3 (2007), 0.3 (2008)
• Advanced economies: 2.6 (2005); 3.1 (2006); 2.8 (2007); Difference from April 2007 Projections: 0.1 (2007)
• United States: 3.2 (2005); 3.3 (2006); 2.0 (2007); Difference from April 2007 Projections: -0.2 (2007)
• Euro area: 1.5 (2005); 2.5 (2006); Difference from April 2007 Projections: 0.2 (2007)
• Germany: 0.9 (2005); 2.4 (2006); Difference from April 2007 Projections: 0.8 (2007); Difference from April 2007 Projections: 0.5 (2008)
• France: 1.7 (2005); 2.2 (2006); 2.3 (2007); Difference from April 2007 Projections: -0.1 (2008)
• Spain: 3.5 (2005); 3.9 (2006); 3.8 (2007); 3.4 (2008)
• United Kingdom: 2.9 (2005); 2.7 (2006)
• Other advanced economies: 4.3 (2005); 4.2 (2006); 4.1 (2007); Difference from April 2007 Projections: 0.4 (2007)
• Newly industrialized Asian economies: 4.7 (2005); 5.3 (2006); 4.8 (2007)
• Other emerging market and developing countries: 7.5 (2005); 8.1 (2006); 8.0 (2007); 7.6 (2008)
• Africa: 5.6 (2005); 6.4 (2006); 6.2 (2007)
• Sub-Sahara: 6.0 (2005); 6.9 (2006)
• Central and eastern Europe: 6.3 (2005); 5.7 (2006); 5.4 (2007)
• Commonwealth of Independent States: 6.6 (2005); 7.7 (2006); 7.1 (2007); Difference from April 2007 Projections: 0.6 (2007); 0.7 (2008)
• Russia: 6.7 (2005); 7.0 (2006); 6.8 (2007)
• Excluding Russia: 9.7 (2005); 8.8 (2006); 7.8 (2007)
• Developing Asia: 9.2 (2005); 9.6 (2006); 9.1 (2007)
• China: 10.4 (2005); 11.1 (2006); 11.2 (2007); 10.5 (2008); Difference from April 2007 Projections: 1.2 (2007); 1.0 (2008)
• India: 9.0 (2005); 8.4 (2006)
• ASEAN-4: 5.1 (2005)
• Middle East: 4.6 (2005); 5.0 (2006); 4.4 (2007)
• Brazil: 3.7 (2005)
• Mexico: Difference from April 2007 Projections: -0.3 (2008)
• World growth based on market exchange rates: 3.6 (year not specified in table extract)
• World trade volume (goods and services): 9.4 (2005); 7.4 (2006)
• Imports: 6.1 (2005); 12.2 (2006); 15.0 (2007); 12.8 (2008); Difference from April 2007 Projections: -1.1 (2008)
• Exports: 5.8 (2005); 8.5 (2006); 10.7 (2007); Difference from April 2007 Projections: -0.7 (2008)
• Commodity prices (U.S. dollars) — Oil1: 41.3 (2005); 20.5 (2006); Difference from April 2007 Projections: -0.8 (2008)
• Nonfuel (average based on world commodity export weights): 10.3 (2005); 28.4 (2006); 14.5 (2007); Difference from April 2007 Projections: -7.8 (2008)
• The average price of oil in U.S. dollars a barrel was $64.27 in 2006; the assumed price is $63.75 in 2007 and $68.75 in 2008.
• London interbank offered rate (percent)2: Six-month rate for the United States and Japan. Three-month rate for the euro area.

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References

• World Economic Outlook
• Other issues of the World Economic Outlook (WEO)
• Research at the IMF
• https://www.imf.org/en/publications/weo
• Global Economy in Crosscurrents of War and Technology
• https://www.imf.org/en/publications/gfsr
• Global Financial Markets Confront the War in the Middle East and Amplification Risks
• https://www.imf.org/en/publications/fm
• Fiscal Policy under Pressure: High Debt, Rising Risks
• https://www.imf.org/en/publications/reo
• Asia and Pacific
• Europe
• Middle East and Central Asia
• Sub-Saharan Africa
• Western Hemisphere
• https://www.imf.org/en/publications/areb
• Getting to Growth in an Age of Uncertainty
• https://www.imf.org/en/publications/finance-development
• More Publications
• groups and methodologies