The International Monetary Fund on Tuesday cut growth outlooks for the United States and other major industrial powers, saying supply chain disruptions and inflation pressures are holding back the global economy's recovery from the COVID-19 pandemic.
In its World Economic Outlook, the IMF trimmed its 2021 global growth forecast to 5.9% from the 6% forecast it made in July. It left a 2022 global growth forecast unchanged at 4.9%.
But the IMF said the minor revision masks major downgrades for some countries.
Global manufacturing has been slammed by shortages of key components like semiconductors, clogged ports, and a labor crunch.
IMF chief economist Gita Gopinath said they expect inflation to return to pre-pandemic levels next year, but warned that persistent supply disruptions could cause problems.
"We have never seen a recovery of this kind, where you have shortages in the labor market at the same time that you have high levels of unemployment, the fact that you have ports that aren't able to off-load container ships. So this is very unique and we have to be particularly vigilant."
The United States is taking the brunt of these effects, and the IMF slashed its 2021 U.S. growth forecast by a full percentage point, to 6.0%, from 7.0% in July - a level that was seen as the strongest pace since 1984.