“Looking forward, medium-term growth prospects remain weak,” said Kristalina Georgieva, President of the International Monetary Fund (IMF).
In her speech at the third G20 Finance Ministers and Central Bank Governors meeting held in Gandhinagar, India, Georgieva said that despite the successive shocks and rapid rise in interest rates in recent years, global growth is positive, albeit low by historical standards, supported by strong labor market and service demand. He said he remains in the area.
Pointing to the slowdown in activity, especially in the manufacturing sector, Georgieva said, “Looking ahead, medium-term growth prospects remain weak.” said.
Georgieva stated that the downward trend of inflation is encouraging, but headline inflation is still very high, and core inflation remains sticky despite serious monetary policy tightening.
Emphasizing that rising food and fertilizer prices are particularly worrying for low-income households, where food insecurity and malnutrition are now more persistent, Georgieva said the risks continue to be on the downside.
Stating that inflation could stay higher for longer, Georgieva said, “This may require further monetary policy tightening and fragmentation could put even more pressure on growth. To mitigate these risks, I urge G20 leaders to take the opportunity to move the global economy onto a more vibrant medium-term path. ” said.
Emphasis on “staying on track” in monetary policy
Talking about her policy priorities, Georgieva said that although there is progress in bringing inflation down permanently, the work is not done yet and it is necessary to stay on the monetary policy route.
Stressing that an early celebration could reverse the hard-won gains so far in reducing inflation, Georgieva said, “Instead, we can use price stability as the basis for growth and prosperity if we stay on course.” said.
Pointing to the importance of rebuilding fiscal buffers, Georgieva noted that growth-enhancing reforms are needed to increase productivity and raise living standards.
To support these reform efforts, Georgieva said the IMF will expand its work to mobilize local resources, improve the quality of the country’s spending, create deep capital markets and improve the private investment climate, both domestic and foreign.