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IMF tells central banks to focus on inflation as recession looms

  • IMF tells central banks to focus on inflation as recession looms
    IMF cuts 2023 global growth to 2.7% on war and downturns IMF tells central banks to focus on inflation as recession looms
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Economy
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IMF cuts 2023 global growth to 2.7% on war and downturns

Fund says ‘worst yet to come’ because of rising living costs, Ukraine war and Chinese slowdown

The International Monetary Fund has told central banks to “stay the course” in their fight against inflation, despite warning that a third of the global economy will be in recession next year.

In its half-yearly update, the Washington-based IMF said the “worst was yet to come”. It cited a combination of cost of living pressures, Russia’s invasion of Ukraine and a slowdown in China as important factors behind a fresh growth downgrade.

Pierre-Olivier Gourinchas, the IMF’s economic counsellor, said storm clouds were gathering but insisted central banks needed to maintain their “laser focus” on defeating inflation or risk the need for even tougher action later if upward price pressures became embedded.