The world economy will enjoy two years of abundance and it is all thanks to Donald Trump. That was the gist of this week’s forecasts from the IMF, dominated as they were by the US president’s tax cuts and their inevitable consequence: a big rise in the US current account deficit. The president who hates trade deficits is about to increase them massively. Managing the consequences will be a big challenge for the global economy. 

In its latest World Economic Outlook, the IMF predicts global growth of 3.9 per cent in 2018 and 2019. That is an upgrade of 0.2 percentage points since the fund’s last round of forecasts and would be the best outcome since 2011. Half of the upgrade is due to the global effects of Mr Trump’s stimulus. The outlook really does look promising — especially if you are an Asian exporter. 

Mr Trump’s stimulus will generate strong growth at home but it has large global effects because the US is already so close to full employment. His tax cuts and spending plans mean the US is on course for budget deficits of around 5 per cent of gross domestic product.