The International Monetary Fund has cut its 2014 growth forecast for the US economy to 2.0 percent from 2.8 percent in April. The reduction was largely due to the economy’s contraction in the first quarter.
The growth forecast for 2015 was unchanged at 3.0 percent. Full employment is not expected to be attained until the end of 2017.
Meanwhile, the US economy appears to be already recovering from the first quarter weakness.
Reports on Monday showed that US industrial production rose 0.6 percent in May, the Federal Reserve Bank of New York’s factory index rose to 19.3 in June, the highest in four years, from 19 the prior month, and the National Association of Home Builders/Wells Fargo housing market index rose to 49 this month from 45 in May.
The positive data did little to boost US stocks. The S&P 500 rose just 0.1 percent on Monday as the violence in Iraq showed no sign of abating.
In Europe, the STOXX Europe 600 fell 0.5 percent.
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