IMF President Georgieva: Risks to the global economy are to the downside

International Monetary Fund President Kristalina Georgieva stated that the global economy has shown resilience against energy shocks, but risks remain skewed to the downside due to fiscal pressures and high public debts.

Resilience against energy shocks

International Monetary Fund (IMF) President Kristalina Georgieva evaluated the impact of developments in the Middle East on the global economy.

It was stated that despite supply disruptions experienced with the closure of the Strait of Hormuz, global growth has managed to demonstrate resilience against inflation and trade tensions.

Factors increasing resilience

It was noted that this resilience in the global economy was provided along with oil and natural gas reserves.

It was recorded that topics such as non-Gulf energy production, renewable energy, and increased coal usage were among the elements increasing resilience.

A more balanced structure and risks

It was expressed that the global economy has attained a more balanced structure compared to April.

However, it was emphasized that risks still carry a downside weight due to mounting fiscal pressures.

Central bank policies

It was noted that central banks might be forced to maintain monetary policies for a long time due to rising government bond yields and stalling disinflation.

It was added that fiscal burdens, especially in emerging economies, could increase due to high public debts and interest pressure.