The International Monetary Fund raised its forecast April 19 for 2006 gross global domestic product (GDP) economic growth to 4.9%, up from 4.3% in its outlook six months ago. The IMF, in its semi-annual World Economic Outlook, said growth is finally spreading from the U.S. to other parts of the industrialized world, but that wide global imbalances are storing up trouble further ahead.
For 2007, the IMF sees world growth slowing to 4.7%, which is up from the forecast of 4.4% given last time.
"Despite higher oil prices and a number of natural disasters, economic activity in the second half of last year and early 2006 was strong, and inflationary pressures remain subdued," the report said.
"While the U.S. is still the main engine of growth among industrial countries, it is increasingly supported by the ongoing expansion in Japan and signs of a sustained recovery in the euro area."
Copyright Agence France-Presse, 2006