Khaberni - Kristalina Georgieva, the Managing Director of the International Monetary Fund, stated today that the global economy is "better off than feared," but that is still not sufficient.
In her introductory speech for the upcoming annual meetings of the IMF and the World Bank next week, Georgieva noted that the global economy "has generally held up against severe tensions."
According to (AFP), Georgieva added that despite the economy's resilience against disruptions, warning signs are increasing, starting with "the rising global demand for gold" and the risk of inflation due to tariffs, expressing her fear that the financial market confidence could "suddenly flip," which might deprive companies of necessary funding.
Also, she warned of the risk of a "severe correction" in stock prices related to companies involved in artificial intelligence development, which seem to be "capitalized at levels unseen since 25 years ago" during the internet bubble.
She urged countries to "get their house in order," especially by reinstating fiscal margins in budgets to cope with upcoming shocks and "ending excessive imbalances" such as the overconsumption in the United States and overly high investments in China.
Georgieva warned of consequences that might include "rising interest rates and increased pressures on borrowing costs that impact other expenditures and limit governments' abilities to face shocks."
