IMF Director Kristalina Georgieva today gave a glimpse into the state of the global economy. He advised global financial leaders to be prepared and relaxed in fighting the various attacks of inflationary pressures.
Georgieva told Reuters on the sidelines of a meeting of finance ministers and G7 central bank governors in Germany that it is increasingly difficult for the central bank to lower inflation without facing a recession, due to growing pressure on energy and food prices from Russia's war in Ukraine, zero measure Covid-19 in China which has reduced production with the economic shutdown, and the need to restructure the supply chain to make it more resilient.
In one statement, he stated that, ‘I think what it takes is to be more prepared because maybe it’s not the last surprise. He also advised to stop viewing inflation as a temporary one that was initially driven by the spread of the Covid-19 epidemic.
However he also expressed optimism that the G7 agreement which acts to provide budget funding for Ukraine can be achieved and can help the country avoid hyperinflation.
Thus the meeting made the topic of discussion was on financing and appropriate timing the main focus to avoid delays that might push the country into monetary financing, where its central bank finances the government effectively.
