The International Monetary Fund (IMF) downgraded its forecasts for growth in the UK and US this year after a disappointing performance in the first quarter for both economies.
In its latest World Economic Outlook the IMF retained its forecast for overall global gross domestic product (GDP) at 3.5% in 2017, unchanged from its previous estimate in April.
However, the IMF tweaked its forecasts for several countries and regions – revising up its growth expectations for China and the eurozone.
Although it maintained its global forecasts, saying that "the pick up in global growth remained on track", the IMF introduced a note of caution into its assessments.
"While risks around the global growth forecast appear broadly balanced in the near term, they remain skewed to the downside over the medium term," the organisation said.
UK and US revised lower
Weaker than expected business activity in the first quarter led the IMF to lower its forecast for UK GDP in 2017 to 1.7% for the year, down from its previous estimate of 2%. It left its forecasts for 2018 at 1.5%.
The IMF's reassessment of UK growth forecasts left it less optimistic on the British economy than the Bank of England, which in March lowered its own forecasts to 1.9% growth in 2017, down from 2%.
"The slowdown is led by weakening consumer spending," the BoE said in its quarterly inflation report, published in May.
US growth was revised lower by the IMF to 2.1% for both 2017 and 2018 from earlier estimates of 2.3% and 2.5% respectively, as it reassessed expectations of a President Trump-led package of economic boosting reforms.
"The major factor behind the growth revision is the assumption that fiscal policy will be less expansionary than previously assumed, given the uncertainty about the timing and nature of US fiscal policy changes," the report said.
China and eurozone boost
China's GDP was revised higher by 0.1 percentage point to 6.7% for 2017 thanks to efforts by authorities to ease fiscal and monetary policy and reduce excess capacity in the industrial sector.
Several countries in the eurozone – including core economies France, Germany, Italy and Spain – were upgraded thanks to "stronger momentum in domestic demand" than previously anticipated.
The 2017 growth forecast for Canada was also revised higher thanks to strong domestic demand.