The International Monetary Fund (IMF) cut its global growth forecast this year, citing the effect of US President Donald Trump's new tariff policies on the world economy.

According to the IMF's forecasts, which include some but not all of the tariff measures introduced this year, the global economy will grow by 2.8 percent this year. That's 0.5 percentage points less than the previous World Economic Outlook (WEO) forecast from January.

Global growth is then projected to reach 3.0% next year, down 0.3 percentage points from January, AFP reports.

"We are entering a new era as the global economic system that has functioned for the past 80 years is realigning," IMF chief economist Pierre-Olivier Gourinchas said ahead of the report's release.

"The risks to the global economy have increased and are decidedly to the downside," he added, noting that recent announcements on U.S. tariffs have more than doubled the Fund's forecast for global trade growth this year.

The report was released as the world's financial leaders gathered in Washington for the spring meetings of the World Bank and the IMF, which are hosted by the two international financial institutions at their headquarters two steps from the White House.

Given Trump's introduction and then suspension of tariffs, the IMF has put in place an April 4 deadline. That means they don't include the administration's latest measures, which raised the level of new tariffs against China to 145%.

If these policies are taken into account and persist, it could significantly slow global growth, the IMF believes. | BGNES