International Monetary Fund Says Global Economy Getting Stronger

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The International Monetary Fund reports that the the worldwide economic outlook is strengthening. The IMF notes that developing countries will outpace advanced economies over the next two years.

The International Monetary Fund (IMF) announced on Monday that Soaring oil prices and inflation in emerging economies pose new risks to global recovery.

But the good news, says the IMF, is that these factors are not yet strong enough to derail it.

The global lender's latest assessment of world economic prospects marked a departure from recent years when its focus was on the potential peril from a near-financial meltdown and recession in advanced countries.

[Olivier Blanchard, IMF Economic Counselor and Research Director]:
"So, for the world economy, for both 2011 and 2012, we expect the growth rate to be 4.5 percent - a fairly high growth rate. But if you look at the details, you find for advanced economies, we forecast only 2.5 percent for each of the two years. And for the emerging and developing countries, we forecast 6.5 percent for each of the next two years - so 4.5, 2.5, 6.5."

The fastest growth in recent years has come from emerging markets like China, Brazil and India.

Blanchard said advanced and developing countries had to take different perspectives towards their economic growth.

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The chief economist said it was too early to judge the effectiveness of difficult measures to stabilize economies taken by countries such as Ireland, Greece and Portugal.

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The IMF's central scenario continues to be one of a slow-paced global economic recovery.

However, among the dangers the fund sees are rising inflation and hard-to-control inflows of capital into emerging markets.

High debt levels in rich nations, such as the United States, are also worrisome.

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