Rich nations must cut debt as global shocks push up borrowing costs, IMF chief tells BBC
Kristalina Georgieva said governments must prioritize fiscal consolidation as bond yields rise, warning that advanced economies have not acted to contain debt-service costs.
- International Monetary Fund head Kristalina Georgieva warned that advanced economies must reduce debt levels after weeks of spiralling interest costs, citing global shocks "pushing debt levels up like a staircase not to heaven."
- Governments raise money selling bonds, but inflation and competition from tech companies investing in artificial intelligence have pushed yields higher in recent months, impacting the world's largest economy where debt surpassed $40tn.
- Borrowing reached £18.3bn in August, almost a fifth higher than the year before, as Prime Minister Andy Burnham prepares for the first Budget next month amid mounting fiscal pressure.
- On the sidelines of the United Nations General Assembly, Georgieva urged politicians to show "courage" to take necessary steps, stating governments must prioritize fiscal consolidation and ensure central banks deliver price stability.
- The IMF assessment notes the global economy faces two forces "pushing in opposite directions"—energy price shocks and artificial intelligence investment. Georgieva acknowledged normalization requires the energy supply shock from the Gulf to finally recede.
41 Articles
41 Articles
(London=Yonhap News) Correspondent Kim Ji-yeon = International Monetary Fund (IMF) Managing Director Kristalina Georgieva called on major developed nations, including the U.S. and the U.K., to reduce public debt...
The head of the International Monetary Fund (IMF) sent a strong message to developed economies - including the US and Britain - calling on governments to limit borrowing and reduce debt levels. In an exclusive interview with the BBC, Kristalina Georgieva warned that successive economic turmoil has raised debt levels "like a staircase that does not lead to heaven", while, as she argued, governments have not yet taken sufficient measures to limit …
A global debt crash in the near future is unlikely, but there is growing concern on the financial markets. Citizens get the consequences even without a huge crisis.
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