WASHINGTON (Kyodo) -- The International Monetary Fund on Thursday warned of a further slowdown in the global economy amid growing inflationary pressure and slowing demand in developed countries.
"Global growth is expected to decelerate significantly in the second half of 2008, before recovering gradually in 2009," the IMF said in a report.
The organization also warned of a poor economic performance ahead for the U.S. economy, saying it "is projected to contract moderately during the second half of the year, as consumption would be dampened by rising oil and food prices and tight credit conditions."
Expansions in developing countries, including emerging economies -- a main engine for the current global economy -- are also expected to lose steam, according to the Washington-based organization.
Meanwhile, the IMF revised upward its projection for global economic growth to 4.1 percent in 2008 from its previous forecast in April of 3.7 percent.
It attributed the upward revision to a smaller-than-expected slowdown in the first quarter.
The IMF also slightly upgraded its growth forecast for 2009 by 0.1 percentage point to 3.9 percent from its World Economic Outlook report released in April.
Global economic growth in 2007 was 5 percent.
By country, the IMF raised its growth projection for the United States by 0.8 point to 1.3 percent in 2008, compared with its April estimate, and by 0.2 point to 0.8 percent in 2009.
The growth estimate for Japan was raised to 1.5 percent in 2008, up 0.1 point from April, while its forecast for 2009 was left unchanged at 1.5 percent.
The IMF revised upward its growth projection for the eurozone economy to 1.7 percent in 2008, up 0.3 point, while leaving its forecast for 2009 unchanged at 1.2 percent.
The latest IMF report also stressed growing inflationary pressure on the back of rising energy and commodity prices and urged policymakers to stem such pressure while keeping an eye on risks to growth.
"The global economy is in a tough spot, caught between sharply slowing demand in many advanced economies and rising inflation everywhere, notably in emerging and developing economies," it said.
The IMF called on policymakers in developed countries to closely monitor inflationary pressure but said the need for credit tightening is "less compelling."