DAVY VIEW

Yesterday (July 26th), the IMF revised down sharply April World Economic Outlook projections. It now sees just 2.9% global growth in 2022, revised down by 0.4pp, due to stronger inflation, the negative impact of COVID-19 restrictions in China and the spill-over from the Ukraine conflict. The IMF’s forecasts imply the euro area will see activity stall in H2 2022, but do not include the risk of disruption to natural gas supplies, which now appears to be crystalising. The IMF expects UK GDP growth to slow to just 0.5% in 2023.