Kristalina Georgieva, head of the International Monetary Fund (IMF), warned that the outlook for the global economy has“darkened significantly.” She said the outlook for the global economy has “darkened markedly” and stressed that a global recession “cannot be ruled out.”
The IMF said the outlook for the global economy has “darkened markedly”
International Monetary Fund (IMF) Managing Director Kristalina Georgieva said in an interview with Reuters on Wednesday that the outlook for the global economy and the prospect of a global recession.
Commenting on the global economy, the IMF Managing Director said.
The outlook has darkened significantly since the last update in April.
He cited several factors, including the universal spread of inflation, more substantial interest rate hikes, slower economic growth in China, and tighter sanctions related to the war in Russia and Ukraine.
In April, the IMF lowered its global growth forecast from an estimated 6.1% in 2021 to 3.6% in 2022 and 2023. This was “0.8 percentage points lower for 2022 and 0.2 percentage points lower for 2023 than the January forecast,” the IMF noted at the time.
The IMF will further lower its global growth forecast later this month, Georgieva noted, adding that this will be the third downgrade this year.
A global recession cannot be ruled out
When asked about the prospect of a global recession, the IMF Managing Director said.
The risk is growing and we cannot rule it out.
“We are in very choppy waters,” she continued. Investors are increasingly concerned about recession risk.
Georgieva noted that recent economic data showed that several large economies, including China and Russia, contracted in the second quarter. She warned that the risks for 2023 are even higher.
The IMF boss said.
It will be a tough 22 years, but maybe even tougher 2023 … The risk of recession increased in 2023.
Georgieva believes that slower economic growth may be a “necessary price” because of the urgent and pressing need to restore price stability.
She opined that ” We need to have an equally strong level of coordination between the central bank and the Treasury, providing support in a very targeted way … . so as not to undermine what monetary policy is trying to achieve.” He stated that.
In June, World Bank President David Malpass warned of a possible global recession. He said, “For many countries, a recession will be inevitable. …… This is the sharpest slowdown in 80 years,” he said.
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