International Monetary Fund Current Affairs - 2019
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The International Monetary Fund (IMF) in its October World Economic Outlook (WEO) has lowered India’s economic growth forecast at 6.7% in 2017 and 7.4% in 2018.
It is slower than 0.5 and 0.3 percentage points projected earlier by IMF. In April 2017 forecast, IMF had revised upwards India’s growth performance for 2016 to 7.1% as opposed to 6.8%
The report has cited impact of demonetisation and implementation of Goods and Services Tax (GST) for expected slowdown during the current and the next year. It also held that India’s slowdown is happening even as the world economy is picking up steam. But it expects revival of growth in future due to structural reform.
India will regain fastest growing major economy tag next year when it is forecast to grow 7.4%, slower than earlier estimate of 7.7% but higher than China’s 6.5%. It also expects that the Indian economy to grow 8% in the medium term on the back of reforms undertaken so far.
IMF forecast is latest in series of downgrades in India’s growth prospects unveiled by other multilateral agencies such as World Bank, Asian Development Bank (ADB) and OECD. Earlier, RBI had lowered its growth forecast for 2017-18 to 6.7% from 7.3%.
World Economic Outlook (WEO)
The WEO is survey conducted and published by IMF. It is published biannually and partly updated two times a year. It portrays the world economy in the near and medium context, with growth projections for up to four years into the future. WEO forecasts include key macroeconomic indicators, such as GDP, inflation, fiscal balance and current account of more than 180 countries around the globe. It also deals with major economic policy issues.
Tags: Business • Demonetisation • Economy • GST • International Monetary Fund
According to RBI, India’s foreign exchange (Forex) reserves have increased by $2.404 billion to touch a lifetime high of $381.167 billion in the week that ended on June 2. The increase was due to increase in foreign currency assets (FCAs).
The components of India’s Foreign Exchange Reserves include: Foreign currency assets (FCAs), Gold, Special Drawing Rights (SDRs) and RBI’s Reserve position with International Monetary Fund (IMF).
Out of all the components, FCAs constitute the largest component of the Forex Reserves.
FCA rose by $2.748 billion to $357.290 billion in the reporting week. FCAs consist of US dollar and other major non-US global currencies. It also comprises of investments in US Treasury bonds, bonds of other selected governments, deposits with foreign central and commercial banks. FCAs include with them the effects of appreciation or depreciation of non-US currencies like the euro, pound, and the yen and is expressed in terms of dollars.
The gold reserves declined by $343.2 million to $20.095 billion in the reporting week.
SDRs’ value decreased marginally by $0.2 million to $1.472 billion.
RBI’s reserve position with the IMF declined by $0.4 million to $2.309 billion.