IMF cuts US 2015 growth forecast to 2.5%

The International Monetary Fund on Thursday cut its 2015 growth forecast for the United States sharply to 2.5 percent due to the unexpected first quarter contraction.

The IMF, though, said the economy is rebounding from the stall and will likely grow at a 3.0 percent rate in 2016.

The new forecast for this year was 0.6 percentage points below the Fund's April prediction. The Fund said momentum had been sapped earlier in the year by "a series of negative shocks."

It pointed to extremely harsh winter weather in parts of the country, the three-month West Coast ports slowdown that locked up trade, the sharp strengthening of the dollar and the downturn in the oil industry.

Nevertheless, the Fund said in its annual report on the US economy, "These developments represent a temporary drag but not a longlasting brake on growth."

"A solid labor market, accommodative financial conditions, and cheaper oil should support a more dynamic path for the remainder of the year."