Real gross domestic product (GDP) growth is seen averaging 3.1 percent year-on-year across the globe in 2015 and 3.6 percent next year by the IMF. This is down from the international body's July forecasts, which suggested economic expansion of 3.3 percent in 2015 and 3.8 percent in 2016. It is also marginally slower than the growth rates of 3.3 percent and 3.4 percent seen in 2013 and 2014, respectively.
"Growth remains fragile and could be derailed if transitions are not successfully navigated. In an environment of declining commodity prices, reduced capital flows to emerging markets, and higher financial market volatility, downside risks to the outlook remain elevated, particularly for emerging economies," the IMF said.
The three biggest risks to the global economy were seen as the upcoming normalization of monetary policy by the U.S. Federal Reserve, the slump in commodity prices and the slowdown in China. China's economy has steadily slowed since 2010 and is seen continuing to do so, with economic growth forecast at 6.8 percent in 2015 and 6.3 percent in 2016.
"China's rebalancing is generating large spillovers, and notwithstanding the Chinese economy's sizable buffers, could be disruptive abroad. Either a moderate slowdown or a harder landing over the medium term could produce sizable spillovers via slower global trade, a further weakening of commodity prices, and confidence effects," the IMF said.