The IMF is now predicting 3.7 per cent global growth in both 2018 and 2019, down from 3.9 per cent for both years.
Saudi Arabia, the biggest Arab economy which contracted 0.9 per cent past year, will expand 2.2 and 2.4 per cent in 2018 and 2019, 0.3 and 0.5 percentage points higher than the July forecast.
IMF's forecast for Singapore's economic outlook remains steady at 2.9% for 2018, but has been revised downward by 0.2 percentage points to 2.5% for the following year. The global crisis lender, which in Indonesia this week is staging its annual meetings with the World Bank, cut its outlook for global GDP on Monday by two tenths to 3.7 per cent through next year.
U.S. Treasury Secretary Steven Mnuchin is expected to meet with global finance officials in Indonesia this week during IMF and World Bank summits, though as of Monday he had no meetings scheduled with Chinese officials - as reported by Reuters.
The fund expects United States economic expansion to peak at 2.9 per cent this year and start to slow down next year as the economic stimulus introduced in the wake of the 2008 global credit crisis begins to wind down and tariff impact begins to hurt.More news: Dow plummets 800 points, biggest drop in 8 months
Prominent US academic Jeffrey Sachs was less diplomatic in his assessment of Trump's shepherding of American trade relationships, slamming the president's repeated claims that deficits with China and other nations meant Americans were being taken advantage of.
This would mark China's weakest growth since 1990 and the impact could be harsher - a decline of 1 percentage point or more - if a worst-case trade war scenario were to materialise.
Fed rate hikes are already increasing pressure on emerging market economies by fueling an outflow of capital as investors seek higher returns.
The IMF chief met with Pakistani officials later Thursday and said afterwards that a team would visit Islamabad for talks on a possible bailout of its shaky economy.
The growth rate of United States for 2018 is 2.9 per cent and that of 2019 has been powered to 2.5 per cent.More news: Will Smith Debuts New Tease for Disney's Aladdin
It also said renewed impetus to reform labour and land markets, along with further improvements to the business climate, are crucial.
Lagarde earlier Thursday said the International Monetary Fund had yet to receive anything formal from Islamabad but that she would meet with the Pakistani delegation in Bali. "Any sharp reversal for emerging markets would pose a significant threat to advanced economies", said Obstfeld.
The risk of a global financial crisis initiated by sharp capital outflows in emerging markets due to the divergence of monetary policies in the U.S. and developing countries remains small but will grow as the Federal Reserve continues to raise its interest rates, as it is expected to do this year and next.
The IMF said a high interest burden and risks from rising yields in India also require continued focus on debt reduction to establish policy credibility and build buffers.More news: Samsung Galaxy A9 quad-camera detailed: tele, standard, wide, depth
"It's tempting to be a bit depressed about this perspective but I'm actually hopeful because there is a clear appetite to improve and expand trade", she said.