IMF Says U.S. Economic Outlook Uncertain, Casts Doubt On Trump Administration's GDP Projections

The International Monetary Fund on Tuesday said there were "larger than usual" risks to the U.S. economy, given policy uncertainties. In its so-called Article IV consultation which it does with every member state, the IMF largely backed the Trump administration's plans to reform individual and corporate taxes, although the IMF also recommended a consumption tax. The IMF did add that even with an "ideal constellation of pro-growth policies," the Trump administration's forecast that it would boost GDP by 1 percentage point is "unlikely." The IMF said the U.S. dollar is moderately overvalued, by 10% to 20%, and said the Federal Reserve should continue to gradually increase interest rates and unwind the balance sheet. It projected GDP growth of 2.1% in 2017 and 2018, 1.9% growth in 2019 and 1.8% growth in 2020.