Global Economy in Peril: IMF Highlights Ongoing Risk

The International Monetary Fund (IMF) issued a warning on Friday about the persistent risks clouding the global economic landscape, primarily due to ongoing trade conflicts. Despite some improvement in trade activities and financial conditions, uncertainty remains a dominant theme, according to First Deputy Managing Director Gita Gopinath.

Gopinath, addressing finance officials at a Group of 20 meeting in South Africa, emphasized the impact of trade tensions and urged countries to mitigate these issues through policy adjustments. She highlighted that, although economic forecasts might see a slight upward revision, significant downside risks persist.

The IMF continues to advocate for responsible fiscal policies and debt management to tackle domestic imbalances. Gopinath stressed the importance of central bank independence and the need for emerging markets to maintain resilience amidst policy uncertainty. Structural changes, including the adoption of the G20's Common Framework for Debt Restructuring, were identified as imperative for managing unsustainable debt.

(With inputs from agencies.)