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International Monetary Fund, Washington DC
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The International Monetary Fund says soaring food and fuel prices will not hurt the global economy as much as officials initially feared.
Thursday's revised World Economic Outlook raises the IMF's growth forecast for the first time since July 2007. Just this past April, the IMF had warned there was a 25 percent chance of a global recession.
IMF officials say the global economy should grow more than four percent this year and just under four percent in 2009, but warn the world is still in a "tough spot."
IMF officials say there is still a threat from inflation, which has become a big concern for both major industrial powers and emerging economies.
Governments around the world have been tightening fiscal policies to fight rising consumer prices, which have been led by soaring food and fuel costs.
The chairman of the U.S. Federal Reserve, the U.S. central bank, warned this week that inflation was too high and said he was concerned about slow economic growth.
Consumer prices have risen four percent in Europe, while Japan has lowered economic expectations because of inflationary pressures.
China said Thursday its economy slumped in the second quarter of 2008. The cost of food in China has jumped 20 percent in the first half of 2008.
India said Thursday its annual inflation rate is just under 12 percent. And officials in the Philippines - the world's largest importer of rice - say they are raising interest rates to fight inflation.
Rice prices in the Philippines have nearly doubled in price in the past year, and inflation is at a 14-year high.
VOA News
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