International Monetary Fund (IMF) Director Kristalina Georgieva urged the US Federal Reserve (Fed) to be extremely cautious in its policies and wary of its impact on the rest of the world.
Georgieva, in an interview with Reuters during her visit to Saudi Arabia, stated that the global recession can be prevented with the right fiscal policies.
Pointing out that global recession can be prevented if the fiscal policies of governments are consistent with monetary policy tightening, Georgieva stated that there may only be countries that will enter recession next year.
Georgieva, FedHe called on e to be extremely cautious in its policies and watch out for its impact on the rest of the world, adding that the Fed’s responsibility was “very high”.
It was noteworthy that IMF Director Georgieva’s call to the Fed came after the United Nations (UN) called on central banks to stop interest rate hikes.
The United Nations Conference on Trade and Development (UNCTAD), in its report announced today, stated that central banks in developed countries such as the Fed and the European Central Bank (ECB) continue to increase interest rates, risking pushing the global economy into recession and then into a prolonged recession.
According to the news of AA; In the report, it was stated that any thought of bringing prices down with higher interest rates without creating a recession was a “careless gamble”.
In the report, which draws attention to the fact that excessive monetary tightening may initiate a period of recession and economic instability in many developing countries and some developed countries at a time when real wages are falling, fiscal tightening, financial turmoil and multilateral support and coordination are insufficient, the report points out that this year’s interest rate hikes in the USA are among the developing countries, excluding China. It was noted that it could cause an estimated 360 billion dollars reduction in revenue for countries with a high income and cause more problems in the future.