IMF chief warns that the economic situation “will keep getting worse before it gets better”

Kristalina Georgieva admits that the war in Ukraine has broken the expectations of the International Monetary Fund

The Director-General of the International Monetary Fund (IMF), said, Thursday, that the global economic situation, supported by high inflation “Things will still get worse before they get better,” she acknowledged, acknowledging that the invasion of Ukraine had upended the entity’s expectations.

In a speech at Georgetown University in Washington, Kristalina Georgieva He said he believed the situation “will get worse before it gets better”.

He pointed out that “the ambiguity is very high,” referring to the effects of the war, noting that the epidemic “has not disappeared yet,” adding that “the risks surrounding financial stability are increasing.”

The Director-General of the International Monetary Fund said that the entity again lowered its forecast for the global economy in 2023, and predicted less economic growth by four billion euros until 2026.

Georgieva also said the foundation had already cut its global growth forecast three times and now expects 3.2% for this year and 2.9% for 2023.

The Director-General of the International Monetary Fund said that the situation can be resolved through three priorities for economies, calling first to take measures to reduce inflation, and to prevent its “consolidation” in current values. However, he said, these efforts must be balanced, or else they could push “many economies into a prolonged recession”.

“Central banks must continue to respond even if the economy slows,” he said.

The second priority, for Georgieva, includes budget measures that protect “the most vulnerable families and businesses,” warning that such measures must be “very well targeted” and an appeal to states “not to support the wealthy.” The Managing Director of the International Monetary Fund also warned of the negative effects of generalized price controls.

Finally, Georgieva stressed the importance of supporting emerging markets and developing economies.