IMF trims outlook for world growth

The International Mone-tary Fund has trimmed its forecasts for 2008 and 2009 world economic growth in a note prepared for a meeting of the Group of 20 (G20) nations, a G20 finance official has said.

The IMF is forecasting world growth this year of 3.9 per cent, down from an estimate of 4.1 per cent in its World Economic Outlook last month, said the official, who is involved in planning for the meeting and spoke on condition of anonymity. It forecasts 2009 growth of 3.7 per cent, down from 3.9 per cent. The IMF report said the world economy would slow further in the second half of the year, the source said.

"Commodity prices will remain high and volatile" and "market turbulence will go on through 2009", the source said.

The IMF left unchanged its forecast for US growth this year at 1.3 per cent, said the official. It shaved its forecast for 2009 US growth to 0.7 per cent from 0.8 per cent.

The IMF trimmed its forecast for euro zone growth this year to 1.4 per cent from 1.7 per cent in July. It estimated 2009 growth at 0.9 per cent, down from 1.2 per cent. The euro zone's economy shrank 0.2 per cent in the second quarter.

G20 Deputy Finance Ministers will meet on Saturday and Sunday in Rio de Janeiro.