Omicron likely to reinforce IMF downgrade of global growth forecasts: MD

Omicron variant is likely to reinforce a downgrade of IMF's outlook on the global economy, Managing Director Kristalina Georgieva said

The coronavirus Omicron variant is likely to reinforce a downgrade of the International Monetary Fund's (IMF) outlook on the global economy, IMF Managing Director Kristalina Georgieva said on Friday.

"Let's be very frank: A new variant that may spread very rapidly can dent confidence and in that sense, we are likely to see some downgrades of our October projections for global growth," Georgieva said at a live-streamed discussion on the global economy.

Georgieva said that even before the emergence of the Omicron variant, the IMF had already been concerned about a loss in the momentum of global growth due to the negative impacts of the Delta variant.

"The Delta variant proved to be a disruption that caused some additional delays in production" of goods in the United States and China, the leading engines for world growth, she said.

The IMF projected in October that advanced economies would regain in 2022 their pre-pandemic aggregate output, and exceed those by 0.9% by 2024.

It said output for emerging market and developing economies, excluding China, was expected to remain 5.5% below the pre-pandemic forecast in 2024.