IMF: Uncertainty in U.S. economic policy may hamper growth

July 24 (UPI) -- The International Monetary Fund lowered its economic growth forecasts for the United States for 2017 and 2018 -- down from 2.3 percent and 2.5 percent, respectively.

The IMF said uncertainty surrounding U.S. fiscal policy is a primary reason for the downgrade Sunday -- to 2.1 percent for both this year and next.

"The major factor behind the growth revision, especially for 2018, is the assumption that fiscal policy will be less expansionary than previously assumed, given the uncertainty about the timing and nature of U.S. fiscal policy changes," the IMF said in its latest World Economic Outlook.

Another reason the IMF said it slashed forecasts was due to the U.S. economy's sluggish start of 1.4 percent this year.

The global economic institution said its global growth forecast remains unchanged at 3.5 percent for 2017 and 3.6 percent for 2018. The IMF also said it downgraded Britain's growth forecast for this year to 1.7 percent -- down from 2 percent.

"Recovery is on track but more work is needed to ensure inclusive growth," IMF Managing Director Christine Lagarde said in a statement.

A growth higher than forecast in Canada, Japan, China and several European countries -- primarily Germany, France and Italy -- were the reason the global growth forecast remains unchanged despite a decrease in the British and U.S. economic outlook.

The IMF said the anticipated decrease in growth for the United States' economy is linked to "less expansionary" fiscal policy -- likely a reference to President Donald Trump's "America first" approach to economic relations.

"The unchanged global growth projections mask somewhat different contributions at the country level," the IMF said. "U.S. growth projections are lower than in April, primarily reflecting the assumption that fiscal policy will be less expansionary going forward than previously anticipated."