The International Monetary Fund (IMF)on Tuesday raised its projections for the global economic growth in 2012 and 2013, but cautioned risks at the same time.

"With the passing of the crisis, and some good news about the U.S. economy, some optimism has returned," said the IMF in its latest World Economic Outlook (WEO) report.

"It should remain tempered," the Washington-based multinational institution cautioned, saying the risk of another crisis is still very much "present" and could well affect both advanced and emerging economies.

According to the report, the world economy would grow at a pace of 3.5 in 2012, 0.2 percentage point higher than the previous estimate in January. Advanced economies would grow at 1.4 percent while emerging and developing economies would expand at a much higher 5.7 percent.

For the year of 2013, the world economic activities would pick up steam and output would grow by 4.1 percent, the Fund projected.

The IMF recognized recent improvement in U.S. economy, predicting growth of 2.1 percent in 2012 and 2.4 percent in 2013. "Risks to the outlook are more balanced but still tend to the downside given fiscal uncertainty, weakness in the housing market, and potential spillovers from Europe," it noted.

The Fund said situation stabilized since early January in Europe with improving financial market sentiment and encouraging signals for activity.

Near-term prospects and risks for Europe depend importantly on the course of events in the euro area, the IMF noted. It predicted the economy in the euro area would contract by 0.3 percent in 2012 and economic growth is expected to strengthen during the course of 2013.

"Much weaker external demand has dimmed the outlook for Asia," the IMF said. However, resilient domestic demand in China, limited financial spillovers, room for policy easing, and the capacity of Asia banks to step in as European banks deleverage suggest that the "soft landing" under way is likely to continue, the Fund noted.

Fiscal consolidation and bank deleveraging would be the two main brakes on growth in advanced economies, the report said.

Emerging countries, which may suffer from volatile capital flows, have enough policy room to maintain a solid growth.

While pointing out geopolitical tension affecting the oil market is surely a risk, the Fund argued the main risk for the global economy remains another possible acute crisis in Europe.

As for the policy implications, the Fund said measures should be taken in Europe to decrease the links between sovereigns and banks, from the creation of euro level deposit insurance to the introduction of limited forms of eurobonds.

The Fund mentioned the highest priority is to durably increase growth in advanced economies, especially in Europe. "For the moment, the focus should be on measures that increase demand," it added.

France maintains 2012 growth forecast despite pessimistic IMF outlook

French Budget Minister Valerie Pecresse said on Wednesday France has kept its growth forecast at 0.7 percent this year despite pessimistic estimate of the International Monetary Fund (IMF).

IMF cuts Ukraine's economic growth forecast to 3 pct

The International Monetary Fund on Wednesday downgraded its projection for Ukraine's economic growth this year from 4.8 percent to 3 percent.

Uzbekistan's economy to grow by 7 percent in 2012: IMF

The International Monetary Fund (IMF) has forecast Uzbekistan's gross domestic product (GDP) to grow by 7 percent in 2012, local media reported on Wednesday.

Brazil to be 7th largest economy in 2012: IMF

Brazil will be surpassed by Britain and return to its previous position as the world's seventh largest economy in 2012, the International Monetary Fund (IMF) said in a report released Tuesday.

IMF expects global economy to grow by 3.5 pct in 2012

The International Monetary Fund (IMF) said Tuesday that the world economy would grow at a rate of 3.5 percent in 2012.

IMF expects U.S. economy to grow 2.1 pct in 2012

The International Monetary Fund (IMF) said on Tuesday the U.S. economy is expected to grow by 2.1 percent in 2012, 0.3 percentage point higher than its January projection.

IMF estimates S.Korean economy to grow 3.5 pct in 2012

South Korean economy was expected to grow 3.5 percent in 2012 amid lingering downside risks to the global economy such as Europe's debt crisis, a report showed Tuesday.

IMF raises Russia's 2012 GDP growth to 4 pct

The International Monetary Fund ( IMF) on Tuesday said that Russia's 2012 GDP growth could reach 4 percent, up from its January prediction of 3.3 percent.

IMF: Spanish economy to shrink 1.8 pct in 2012, but grow 0.1 pct in 2013

The International Monetary Fund (IMF) on Tuesday said the Spanish economy would shrink by 1.8 percent this year, but could swing back to growth in 2013.

Global fiscal adjustment faces new challenge: IMF

Global fiscal adjustment is in face of new challenge as the world economy is slowing, making harder for policymakers to balance fiscal problem and economic growth, said the International Monetary Fund (IMF) on Tuesday.