The International Monetary Fund has revised its global growth forecasts for 2023 downwards by 0.3 percentage points to 2.6 per cent.

“The IMF has today warned the global economy is headed for turbulent and uncertain waters – with many economies at risk of slipping into recession, risks of further energy and food price shocks, and debt distress hitting emerging markets,” Treasurer Jim Chalmers said.

Despite the challenges facing the global economy, Dr Chalmers asserts Australia is in a strong position.

“It’s not our expectation that the Australian economy will go backwards,” he told reporters on Tuesday.

Chalmers has flown to Washington to meet with the head of the US central bank, IMF and World Bank bosses and finance ministers from other nations.

He said the meetings would give him a chance to take the temperature of the deteriorating global economy ahead of his first budget on October 25.

“It is clear that there is no easy path ahead – that’s why the October budget will build resilience by delivering responsible cost-of-living relief, invest in our people and our economy, and begin the hard yards of budget repair.”

He also welcomed the IMF’s warning to make sure fiscal policy does not make the job of monetary policy harder.

On Wednesday, a senior Reserve Bank of Australia official will deliver a speech that should shed some light on how far and fast the central bank will hike rates.

Assistant governor Luci Ellis will speak on the neutral rate, which is the level where interest rates neither have a stimulatory nor contractionary effect on the economy.

The central bank has previously indicated the neutral rate is at least 2.5 per cent, which is the middle of its target inflation band of two to three per cent.

The RBA has been aggressively hiking rates from record lows since May, although it stepped back to a gentler increase in October.

The cash rate is sitting at 2.6 per cent.

-AAP