Interest rates, and large capital outflows point to a continued accommodative stance

The economy is expected to continue to grow robustly, although not at the pace seen before

last year’s slowdown. Staff projects GDP growth of 5? percent in 2005, fuelled by consumption.

Both exports and investment are expected to remain subdued compared to previous years, high

Oil prices notwithstanding, as concerns about the investment climate linger and supply constraints

In the oil sector are unlikely to ease in the near future. Inflation, which was already

running at an annual rate of 7? percent in the first half of 2005, is likely to exceed the official

Target again this year. External vulnerability has been greatly reduced since the 1998 crisis owing

to a very favorable balance of payments position and large foreign reserves of more than 3? times

Short term debt.

16.7.1.4. Read, translate the text “IMF Forecasts on Global Economic Development” and explain

The indexes in the graph.

IMF Forecasts on Global Economic Development

Recent forecasts by leading national and international economic organisations on global economic

Development prospects in 2004 were favourable, though every report paid tribute to the high

Uncertainty of the world outlook and the possibility of a gloomier outcome.

In its emergency December issue of the World Economic Outlook, the IMF released new projections