IMF chief says rate hike aimed at curbing inflation could widen the global economic gap
Washington:
IMF Managing Director Kristalina Georgieva said on Wednesday that raising interest rates aimed at combating inflation could exacerbate a “dangerous” and “deep” divergence in economic growth between advanced and developing economies.
Georgieva said inflation was not a universal phenomenon, but a problem in many countries, and particularly in the United States, where US consumer prices rose 7 percent in 12 months to December, the biggest annual increase in nearly four decades. was growth.
Ms Georgieva said at an event organized by the Center for Global Development that the Federal Reserve and other central banks know how to handle inflation, but it could be a delicate balancing act, and “spillover effects on emerging markets…. may add fuel to the fire of deviance”.
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