WASHINGTON, Oct 5 — The International Monetary Fund expects global economic growth in 2021 to fall slightly below its July forecast of 6 per cent, IMF chief Kristalina Georgieva said today, citing risks associated with debt, inflation and divergent economic trends in the wake of the Covid-19 pandemic.
“We face a global recovery that remains ‘hobbled’ by the pandemic and its impact. We are unable to walk forward properly — it is like walking with stones in our shoes,” she said. While central banks could generally avoid tightening for now, they should be prepared to act quickly if the recovery strengthened faster than expected, or risks of rising inflation materialized, she said.Global debt levels, now at about 100 per cent of world gross domestic product, meant many developing countries had very limited ability to issue new debt at favourable conditions, Georgieva said.