Sunday

23rd Sep 2018

UK economy faring better than expected, says IMF

  • "Domestic demand held up better than expected in the aftermath of the Brexit vote," the IMF says (Photo: Harshil Shah)

The International Monetary Fund has upgraded its economic forecasts for the eurozone and the UK this year, but said British growth would slow down in 2018.

In an update to its biannual World Outlook published on Monday (16 January), the IMF said the eurozone would grow by 1.6 percent in 2017, a 0.1 percentage point increase on the forecasts published in October.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

It expects the eurozone economy to grow at a similar pace in 2018, without revising its previous forecast.

It says the British economy will grow by 1.5 percent this year, 0.4 points more than expected in October, after 1.6 percent growth in 2016.


The IMF notes that "domestic demand held up better than expected in the aftermath of the Brexit vote".

But it has revised its 2018 forecast for the UK down by 0.3 points to 1.4 percent growth.

The Washington-based institution notes that "the outlook for advanced economies has improved for 2017-18". But it highlights "balance sheet weaknesses in parts of the euro area" and says that goods and services output "remains below potential in a number of other advanced economies, notably in the euro area".

Looking at the global conditions around the EU economy, the fund warns of "uncertainty surrounding the policy stance of the incoming US administration and its global ramifications" and of a "possible shift toward inward-looking policy platforms and protectionism".

It also insist that geopolitical risks such as wars, terrorism and "the tragic plight of refugees and migrants in neighbouring countries and in Europe" could have a negative impact on global economic activities.

Looking at different EU countries, the IMF notes that Spain and Germany, along with the UK, had a stronger than-expected performance during the latter part of 2016.



It expects the Germany economy to grow by 1.5 percent in 2017 and 2018 - up 0.1 points compared with the October forecasts - and the Spanish economy to grow by 2.3 and 2.1 percent in 2017 and 2018 - a 0.1 and 0.2 point upward revision.

The fund also revised downward the prospects for Italy. It says the country should grow by 0.7 and 0.8 percent this year and next year. It is 0.2 and 0.3 points less than expected in October.

IMF: Brexit would cause severe damage

The International Monetary Fund warns of the consequences of a British exit from the EU. Brexit campaigners say the fund is politically motivated.

Airbnb agrees to clarify pricing for EU

The justice commissioner says the accommodation-rental website will better inform users about prices, and about the legal status of their 'hosts'. Facebook, however, could face sanctions if it doesn't comply with EU rules.

'Every group split' ahead of EU copyright vote

Political groups in the European Parliament are split about how to vote for a directive that would reform the EU's copyright regime - amid warnings that freedom of expression and creators' rights are at risk.

Airbnb agrees to clarify pricing for EU

The justice commissioner says the accommodation-rental website will better inform users about prices, and about the legal status of their 'hosts'. Facebook, however, could face sanctions if it doesn't comply with EU rules.

Stakeholders' Highlights

  1. NORDIC COUNCIL OF MINISTERSThe vital bioeconomy. New issue of “Sustainable Growth the Nordic Way” out now
  2. NORDIC COUNCIL OF MINISTERSThe Nordic gender effect goes international
  3. NORDIC COUNCIL OF MINISTERSPaula Lehtomaki from Finland elected as the Council's first female Secretary General
  4. NORDIC COUNCIL OF MINISTERSNordic design sets the stage at COP24, running a competition for sustainable chairs.
  5. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  6. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  7. IPHRCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  8. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  9. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All
  10. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  11. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  12. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow

Latest News

  1. Brexit and MEPs expenses in the spotlight This WEEK
  2. Wake-up call on European Day Against Islamophobia
  3. Sound of discord at 'Sound of Music' Salzburg summit
  4. Salzburg summit presses for bigger Frontex mandate
  5. UK's post-Brexit plan 'will not work', EU says
  6. Airbnb agrees to clarify pricing for EU
  7. Libya keeps coast guards rejected by the EU
  8. EU divisions on menu at Salzburg dinner

Join EUobserver

Support quality EU news

Join us