The International Monetary Fund will next week forecast a return to recession for the eurozone in 2012, a move likely to increase the pressure on governments to contribute to its latest $600bn (£388bn) fundraising drive.
The IMF is scheduled to release its revised World Economic Outlook (WEO) estimates on Monday, with analysts expecting a sharp reduction because of the ongoing eurozone crisis.
According to the Italian agency, Ansa, citing a leaked draft of the WEO, the IMF will forecast that the eurozone economy will contract by 0.5 per cent over the course of this year, with Italy shrinking by 2.2 per cent and Spain by 1.7 per cent.
At the IMF’s meeting in September 2011, it forecast eurozone growth in 2012 of a comparatively healthy 1.1 per cent.
The eurozone’s economic engine, Germany, is projected to grow by just 0.3 per cent this year while France is pencilled in for growth of just 0.2 per cent.
Global growth estimates are also likely to be slashed by the IMF on the back of a eurozone recession.
According to Ansa, the IMF now estimates that 2012 global GDP will rise 3.3 per cent, rather than the previous forecast of 4 per cent.
