International Monetary Fund (IMF) invited United States to fight “urgently” against poverty and inequality that threaten their economic potential, in an annual review of the first world economy published on Wednesday.
the Fund’s experts also reduced to 2 , 2% growth forecast US gross domestic product this year , down 0.2 points from its April report. For 2017, the IMF projects growth of 2.5%.
In view of the global movement of disinflation, the rise in interest rates in the US should be “very progressive” and the US central bank (Fed) should be allowed to accept inflation (currently 1.1%) to temporarily exceed its target of 2% , the IMF estimated.
“despite its expansion , United States faces a set of forces that despite the permanence of a better economic well-being, “said moreover Fund, referring to the aging population, infrastructure, lower middle class and the growing polarization of income.
These factors add up to “dire long-term trends that have affected revenues,” said the institution. He further stressed that the labor income of the middle class are the lowest in the last 30 years.
“The distribution of wealth and income is increasingly polarized and poverty increased,” he added the IMF.
“There is an urgent need to attack poverty,” said the agency, noting that one American in seven live in poverty and that 40% of them work.
the Fund defended tax recovery better targeted and federal minimum wage (currently $ 7.25 an hour).
the drop in the employment rate will continue in the coming years, especially with the demographic effects, you can stop, according to the IMF, with measures to promote the employment of women (help in child care, parental leave) and especially by the adoption of a reform immigration based on qualifications.
the employment rate, which includes people who are working or actively seeking employment, lost five points in fifteen years from over 67% in 2000 . less than 63% in 2015
the infrastructure spending should be increased “new investments urgently (…) particularly with regard to land transport are required”. “This would help reduce congestion and boost the productivity of private activity.”
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