The Korea Times close
National
  • Politics
  • Foreign Affairs
  • Multicultural Community
  • Defense
  • Environment & Animals
  • Law & Crime
  • Society
  • Health & Science
Business
  • Tech
  • Bio
  • Companies
Finance
  • Companies
  • Economy
  • Markets
  • Cryptocurrency
Opinion
  • Editorial
  • Columns
  • Thoughts of the Times
  • Cartoon
  • Today in History
  • Blogs
  • Tribune Service
  • Blondie & Garfield
  • Letter to President
  • Letter to the Editor
Lifestyle
  • Travel & Food
  • Trends
  • People & Events
  • Books
  • Around Town
  • Fortune Telling
Entertainment
& Arts
  • K-pop
  • Films
  • Shows & Dramas
  • Music
  • Theater & Others
Sports
World
  • SCMP
  • Asia
Video
  • Culture
  • People
  • News
Photos
  • Photo News
  • Darkroom
  • The Korea Times
  • search
  • Site Map
  • E-paper
  • Subscribe
  • Register
  • LogIn
search close
  • The Korea Times
  • search
  • Site Map
  • E-paper
  • Subscribe
  • Register
  • LogIn
search close
World
  • SCMP
  • Asia
Sat, August 20, 2022 | 00:30
IMF chief says 'cannot rule out' possible global recession
Posted : 2022-07-07 09:13
Updated : 2022-07-07 17:14
Print Preview
Font Size Up
Font Size Down
IMF Managing Director Kristalina Georgieva speaks during a conference hosted by the Vatican on economic solidarity, at the Vatican, February 5, 2020. Reuters-Yonhap
IMF Managing Director Kristalina Georgieva speaks during a conference hosted by the Vatican on economic solidarity, at the Vatican, February 5, 2020. Reuters-Yonhap

The head of the International Monetary Fund (IMF) on Wednesday said the outlook for the global economy had "darkened significantly" since April and she could not rule out a possible global recession next year given the elevated risks.

IMF Managing Director Kristalina Georgieva told Reuters the fund would downgrade in coming weeks its 2022 forecast for 3.6 percent global economic growth for the third time this year, adding that IMF economists were still finalizing the new numbers.

The IMF is expected to release its updated forecast for 2022 and 2023 in late July, after slashing its forecast by nearly a full percentage point in April. The global economy expanded by 6.1 percent in 2021.

"The outlook since our last update in April has darkened significantly," she told Reuters in an interview, citing a more universal spread of inflation, more substantial interest rate hikes, a slowdown in China's economic growth, and escalating sanctions related to Russia's war in Ukraine.

Fed: Sharply higher rates may be needed to quell inflation
Fed: Sharply higher rates may be needed to quell inflation
2022-07-07 09:26  |  World

"We are in very choppy waters," she said. Asked if she could rule out a global recession, she said, "The risk has gone up so we cannot rule it out."

Recent economic data showed some large economies, including those of China and Russia, had contracted in the second quarters, she said, noting the risks were even higher in 2023.

"It's going to be a tough '22, but maybe even a tougher 2023," she said. "Recession risks increased in 2023."

Investors are growing increasingly concerned about recession risks, with a key part of the U.S. Treasury yield curve inverted for a second straight day on Wednesday, in what has been a reliable indicator that a recession is looming. Federal Reserve Chair Jerome Powell last month said the U.S. central bank was not trying to engineer a recession, but was fully committed to bringing prices under control even if doing so risked an economic downturn.

Georgieva said a longer-lasting tightening of financial conditions would complicate the global economic outlook, but added it was crucial to get surging prices under control.

The global outlook was more heterogeneous now than just two years ago, with energy exporters, including the United States, on a better footing, while importers were struggling, she said.

Slower economic growth may be a "necessary price to pay" given the urgent and pressing need to restore price stability, she said.

Georgieva cited a growing risk of divergence between fiscal and monetary policies, and urged countries to carefully calibrate those actions to avert any chance of fiscal support undermining central bankers' efforts to control inflation.

"We need to create the same strong level of coordination between central banks and finance ministries so they provide support in a very targeted way ... and don't weaken what monetary policies are aiming to achieve," she said. (Reuters)



 
LG
  • How can Korea's taxi shortage be resolved?
  • Adoptee chef discovers herself and family through Korean cooking
  • North Korea refuses to form ties with Yoon-led South Korea: experts
  • Activist professor requests strong punishment for racist abuse against Son Heung-min
  • 887 undocumented foreign workers, brokers, employers caught in crackdown
  • [INTERVIEW] Restoring bilateral ties will boost Korean studies in Japan: professor
  • Aviation stocks gain traction on oil price fall, travel demand recovery
  • Kakao retracts sale of mobility unit
  • Busan mayor proposes BTS military exemption to promote World Expo 2030 bid
  • Seoul National University to select freshmen without assigning majors in advance
  • Interactive News
  • With tough love,
  • 'Santa dogs' help rebuild burnt forests in Andong
  • 'Santa dogs' help rebuild burnt forests in Andong
  • A tale of natural wine
    • 'Mukbang' binge-eating shows give way to new trend of eating little 'Mukbang' binge-eating shows give way to new trend of eating little
    • [INTERVIEW] YouTubers bridge Korean, Muslim and Latin American cultures [INTERVIEW] YouTubers bridge Korean, Muslim and Latin American cultures
    • [INTERVIEW] Jung Woo shapes his character for Netflix's 'A Model Family' [INTERVIEW] Jung Woo shapes his character for Netflix's 'A Model Family'
    • NCT Jaehyun drops first solo single 'Forever Only' NCT Jaehyun drops first solo single 'Forever Only'
    • Artist Do Ho Suh invites children to his clay fairyland Artist Do Ho Suh invites children to his clay fairyland
    DARKROOM
    • Ice is melting, land is burning

      Ice is melting, land is burning

    • Tottenham 6-3 Team K League

      Tottenham 6-3 Team K League

    • Afghanistan earthquake killed more than 1,000

      Afghanistan earthquake killed more than 1,000

    • Divided America reacts to overturn of Roe vs. Wade

      Divided America reacts to overturn of Roe vs. Wade

    • Namaste: Yogis to celebrate International Yoga Day

      Namaste: Yogis to celebrate International Yoga Day

    The Korea Times
    CEO & Publisher : Oh Young-jin
    Digital News Email : webmaster@koreatimes.co.kr
    Tel : 02-724-2114
    Online newspaper registration No : 서울,아52844
    Date of registration : 2020.02.05
    Masthead : The Korea Times
    Copyright © koreatimes.co.kr. All rights reserved.
    • About Us
    • Introduction
    • History
    • Location
    • Media Kit
    • Contact Us
    • Products & Service
    • Subscribe
    • E-paper
    • Mobile Service
    • RSS Service
    • Content Sales
    • Policy
    • Privacy Statement
    • Terms of Service
    • 고충처리인
    • Youth Protection Policy
    • Code of Ethics
    • Copyright Policy
    • Family Site
    • Hankook Ilbo
    • Dongwha Group