The international monetary Fund (IMF) today updated its Outlook for the us economy, the report said Fund. Overall, according to the head of the Fund Christine Lagarde, she now is in good shape, and economic growth in the near future will gradually accelerate. At the same time, the IMF notes, there are now many threats to the stable development of the country, one of which is over-valued dollar.
States have a fairly large balance of payments deficit (current-accout deficit). Last week statistics of the U.S. Department of Commerce published the preliminary deficit for the first quarter of 2016: $to 124.7 billion, compared to $113.4 billion in the previous quarter. Accordingly, the deficit increased from 2.5% to 2.7% of GDP.
According to IMF forecasts, by 2020 the deficit will grow even more — up to 4% of GDP or even higher. This means that the U.S. dollar is already overvalued by about 10-20%, said experts of the Fund.
In General, the US GDP in 2016, according to IMF forecasts, will increase by 2.2%. This is below previous expectations of the Fund at 2.4% (published in the context of the report “Forecasts for the world economy” in mid-April). The forecast for 2017 was unchanged at 2.5% growth.
Despite the fact that last year the American economy added almost 2.5 million new jobs to the States, said today in her speech Lagarde, is now at least four great challenges, each of which is somehow associated with the labour market. This reduction of the economically active population, falling productivity, growing inequality in income distribution and a large proportion of the population below the poverty line.
Officially, the share of Americans below the poverty line is nearly 15%. However, a year earlier, the Forbes columnist Tim Worstall argued that the principles of calculating the indicator has not changed since the 1960-ies, and the real level of poverty in the United States three times lower.
The experts of the IMF are confident that the U.S. economy high level of poverty is a serious problem and offered immediately to deal with this, to begin with, the increase of social expenditures. For example, raising the minimum wage level and the introduction of paid maternity leave for women.
The minimum wage varies from state to state, but in most regions of the United States it is the Federal target guideline of the Ministry of labor at $7.25 per hour. This figure has not changed since July 2009. The highest minimum wage ($10.5 hours) recorded in the US capital Washington, moreover, has already adopted a law according to which it will increase to $11.5 next year. The lowest level of the minimum wage observed in the States of Wyoming and Georgia, only $5,15 per hour.
In the end, the IMF welcomed the policy of the us Federal reserve’s gradual, careful increase of the base interest rate. “At this stage it is obvious that the strategy of gradual movement of rates upwards is the correct one”, — consider in Fund.