Emerging economies facing headwinds from weaker capital flows, currency dips: Gopinath

IMF Chief Economist Gita Gopinath on Monday flagged weakening global growth at a rate higher than expected and said emerging economies are also facing risks triggered by capital flows due to US actions and currency depreciations.

While global growth in 2018 remained close to post-crisis highs, the global expansion is weakening and at a rate that is somewhat faster than expected, Gopinath said here while announcing the latest update to the IMF's World Economic Outlook.

IMF has projected global growth at 3.5 per cent in 2019 and 3.6 per cent in 2020, 0.2 and 0.1 percentage point below its October projections.

Notwithstanding the modest downward revisions, Gopinath said risks to more significant downward corrections are rising.

While financial markets in advanced economies appeared to be decoupled from trade tensions for much of 2018, the two have become intertwined more recently, tightening financial conditions and escalating the risks to global growth, she added.

The US expansion ...