Ahead of the G20 Leaders' Summit in Indonesia, the International Monetary Fund (IMF) has projected a 'gloomier' outlook for the world economy.

Citing the G-20 Report on Strong, Sustainable, Balanced, and Inclusive Growth, the IMF said that recent high-frequency indicators confirm that the global growth "outlook is gloomier".

There has been a steady worsening in recent months for purchasing manager indices that are tracking a range of G20 economies, the IMF said, adding that these survey-based measures gauge the momentum of manufacturing and services activity.

The IMF said that global economic growth prospects are confronting a unique mix of headwinds, including from Russia’s invasion of Ukraine, interest rate increases to contain inflation, and lingering pandemic effects such as China’s lockdowns and disruptions in supply chains.

"Despite growing evidence of a global slowdown, policymakers should continue to prioritize containing inflation, which is contributing to a cost-of-living crisis, hurting low-income and vulnerable groups the most. As our G20 report emphasizes, the macroeconomic policy environment is unusually uncertain," the IMF said.

The international lender further said that continued fiscal and monetary tightening is likely needed in many countries to bring down inflation and address debt vulnerabilities.

It added that these actions will continue to weigh on economic activity, especially in interest-sensitive sectors such as housing.

"The challenges that the global economy is facing are immense and weakening economic indicators point to further challenges ahead. However, with careful policy action and joint multilateral efforts, the world can move toward stronger and more inclusive growth," the IMF said.