IMF chief warns of great uncertainty in economic policy

(Patria) - Uncertainty regarding economic policy is high, said the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, at the end of the first meeting of finance ministers and central bank governors of the G20 in Cape Town, South Africa.

She said that governments around the world are changing policy priorities and that there are very significant policy changes in the United States of America (USA) in areas such as trade policy, taxation, public spending, immigration and deregulation, with implications for the US economy and the rest of the world.

She said that governments in other countries are also adjusting their policies, and the combined impacts of possible policy changes are complex and still difficult to assess, but will become clearer in the coming months.

She emphasized that risks also vary, with some growth potential in the USA in a very short period of time.

"But overall risks are negative for most other economies, including the risk of disruption to the disinflation process caused by policies or capital outflows from emerging market economies," she noted.

Georgieva also said that the IMF has forecast the world economy to grow by 3.3 percent in 2025 and 2026, "stable, but well below the historical average and in the context of high levels of public debt."

"Underlying this, we see a widening divergence among economies, with stronger growth in the USA and a somewhat more gradual recovery in the EU than previously expected," she added, stating that the global disinflation process continues.