IMF Slashes US Growth Forecast, Sees ‘Narrowing Path’ to Avoid Recession

People drive outside the Lincoln Tunnel at the start of the Memorial Day weekend, under rising gas prices and record inflation, in Newport, N.J., on May 27, 2022. Eduardo Munoz/Reuters

WASHINGTON—The International Monetary Fund on Friday slashed its U.S. economic growth forecast as aggressive Federal Reserve interest rate hikes cool demand but predicted that the United States would “narrowly” avoid a recession.

In an annual assessment of U.S. economic policies, the IMF said it now expects U.S. Gross Domestic Product to grow 2.9 percent in 2022, less than its most recent forecast of 3.7 percent in April.