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Washington - The International Monetary Fund trimmed its global growth forecast by 0.1 percentage points to 3.3% for 2014 and 0.2 points to 3.8% next year, according to Tuesday's quarterly update of its World Economic Outlook.
"World growth is mediocre and a bit worse than forecast in July," IMF chief economist Olivier Blanchard said.
Fizzling economic recoveries in Japan and the eurozone accounted for much of the 2014 reduction.
Since July, the Washington-based crisis lender has lowered its 2014 expectations for Japan by 0.7 points to 0.9% growth, and the eurozone by 0.3 points to 0.8% growth.
Germany and France - the eurozone's largest economies - booked significant reductions in growth for this year and 2015, under the IMF projections. Italy, the currency area's third-largest economy, is now facing a small 2014 contraction, according to the new forecast.
"There is a risk that the recovery in the euro area could stall, that demand could weaken further, and that low inflation could turn into deflation," Blanchard said.
"This is not our baseline, because we believe euro area fundamentals are slowly improving. But should such a scenario play out, it would be the major issue confronting the world economy."
The United States has roared back from a difficult first quarter, and the IMF hiked its expectation for this year by 0.5 points to a growth rate of 2.2%.
Globally, the IMF pared back its 2015 expectations for emerging market and developing economies.
China and India will continue to enjoy buoyant growth under the forecast, while expectations for Brazil, South Africa and Eastern Europe were reduced significantly.
The IMF slashed its expectations for 2015 Russian growth in half, to 0.5%, as the country's economy continues to suffer impacts from the conflict in eastern Ukraine. The United States and European Union have accused Moscow of fuelling pro-Russian separatist movements, and investors have fled Russia and Ukraine alike.
Conflict in Iraq and Syria has yet to make a significant impact on global energy prices.
"But clearly, this could change in the future, with major implications for the world economy," Blanchard said.
The IMF intensified its longstanding calls for structural reforms to boost productivity and efficiency in rich and poor countries alike.
"In advanced economies as well as emerging market and developing economies, there is a general, urgent need for structural reforms to strengthen growth potential or make growth more sustainable," the report found.
The pace of global economic recovery has "disappointed" in recent years, while downside risks to global growth have increased in the last six months, including geopolitical and financial market risks.
Following the 2008 financial crisis, the world economy enjoyed a steep rebound. But growth has declined since 2010's 5.4% - due to new shocks including the euro crisis - hitting 3.3% in 2013, with the IMF now forecasting the same rate this year.
2015's projected 3.8% growth would break the trend of decline. IMF economists noted in Tuesday's report, though, that their forecasts have consistently been too high.
