IMF warns the US over rising high poverty, inequality in the country
Key trends in the economy that it said will slowly choke off avenues to future growth if not addressed soon.
The International Monetary Fund warned the United States over poverty and rising inequality in the country, saying both could hold back the country`s economic potential.
The IMF cut its outlook for US economic growth this year to 2.2%, compared to 2.4% forecast at the beginning of the year. It cited the impact of slower global growth overall, the contraction in the energy industry due to low oil prices, and a slowdown in domestic consumer spending.
The Washington-based global crisis lender said the US economy is in "good shape" generally, growing more strongly than other leading advanced economies, with unemployment at a nearly nine year low and inflation in check.
The world`s largest economy "has repeatedly demonstrated its resilience in the face of financial market volatility, a strengthening dollar, and subdued global demand," the report said.
Yet it identified key trends in the economy that it said will slowly choke off avenues to future growth if not addressed soon, particularly a high level of poverty for a rich country and increasing inequality.
"Our assessment is that, if left unchecked, these four forces -- participation, productivity, polarization, and poverty -- will corrode the underpinnings of growth (both potential and actual) and hold back gains in US living standards," said IMF managing director Christine Lagarde.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
SBI 444-day FD vs Union Bank of India 333-day FD: Know maturity amount on Rs 4 lakh and Rs 8 lakh investments for general and senior citizens
Power of Compounding: Salary Rs 25,000 per month; is it possible to create over Rs 2.60 crore corpus; understand it through calculations
New Year Pick by Anil Singhvi: This smallcap stock can offer up to 75% return in long term - Check targets
Power of Compounding: How many years it will take to reach Rs 2 crore corpus if your monthly SIP is Rs 3,000, Rs 4,000, or Rs 5,000
Retirement Calculator: 40 years of age, Rs 50,000 monthly expenses; what should be retirement corpus and monthly investment
07:43 PM IST