The International Monetary Fund on Tuesday cut its world growth forecast for 2016 to 3.4% from 3.6%. In a quarterly update to its World Economic Outlook, the organisation also cut its 2017 forecast to 3.6%, down from 3.8% three months ago, reported Bloomberg.

Maurice Obstfeld, chief economist of the International Monetary Fund said that global financial markets seem to be overreacting to falling oil prices and China. He added that it was criticial for China to be clear about its overall policy strategy, including its currency.

The IMF said China's growth would slide to 6.3% in 2016 and further down to 6% in 2017, but added that "India and the rest of emerging Asia are generally projected to continue growing at a robust pace". It retained India's growth projection for the next two years at 7.3% and 7.5%, respectively, reported PTI.