By Hugo Dixon
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The global economy is not as healthy as it looks. The International Monetary Fund now predicts 4.4 percent growth for 2011. But inflation has reared its ugly head across the globe, suggesting that many economies are growing faster than can be sustained without structural changes. Spurring on reform should be the main focus of the annual World Economic Forum shindig this week in Davos.

If one wants to look at the glass half full, there are things to feel positive about. The U.S. economy is growing smartly again -- the IMF predicts 3 percent this year. China and India should each grow at around 9 percent this year. Even the euro zone may be pulling itself out of crisis.

But the glass is still very much half empty, too. America is only growing so rapidly because it has engaged in loose monetary and fiscal policies. The monetary splurge has resulted in hot money spilling out across the world -- which, in turn, is driving asset and consumer price inflation and that is causing difficulties in emerging economies. The fiscal profligacy, meanwhile, will have to be reined in -- or America will suffer its own sovereign debt crisis in a few years time. The same goes for Japan, which is living on borrowed time and borrowed money.

China and India, meanwhile, are trying to curb inflation. But each is moving gingerly. Beijing is unwilling to allow the yuan to appreciate significantly -- something which would also help rebalance global trade flows. And India is maintaining negative real interest rates, despite nudging up policy rates by another 25 basis points this week.