The US faces economic “headwinds” and “pernicious” trends including a shrinking middle class that could slow growth in the long term, the International Monetary Fund has warned.
The US is facing a combination of growing economic headwinds and “pernicious” trends including a that risk turning its slowing potential growth into a destructive long-term reality, the International Monetary Fund has warned.In a statement marking the end of their annual mission to assess the US economy, IMF economists said the country was in “good shape”, citing 2.4m jobs created in the past year and declaring slowing growth in recent quarters had been a temporary setback. It predicted US GDP gross domestic product would grow 2.2 per cent this year, down from 2.4 per cent in 2015.
But the IMF offered a much more sobering view of the economy the next president will inherit, warning recent weak employment and other data may reflect the economy’s lower potential growth rate and daunting longer-term trends. It also warned the US dollar was now 10-20 per cent overvalued and that a decision on Thursdaytomorrow by voters in the UK to leave the European UnionEU could lead to a further appreciation as investors poured into the currency as a haven.