Posted by on January 11, 2022 9:07 am
Categories: Breaking News Epoch Times News

Emerging Economies Must Take Precautionary Measures Against US Rate Hikes: IMF

Emerging economies across the world must prepare for interest rate hikes in the U.S. based on their circumstances and vulnerabilities, said the International Monetary Fund (IMF), as ripple effects of the hike could result in adverse feedback loops like financial instability, currency depreciation, and rapid inflation. Surging prices, tight labor market, and Omicron-related disruptions have led to the U.S. Federal Reserve tightening its monetary policy and accelerating the tapering of asset purchases to rein in the 39-year-high inflation. “These changes have made the outlook for emerging markets more uncertain. These countries also are confronting elevated inflation and substantially higher public debt,” said the International Monetary Fund in a blog post on Monday. The average gross government debt in emerging markets has been increasing, “reaching an estimated 64 percent of GDP by end 2021, with large variations across countries. But, in contrast to the United States, their economic recovery and labor markets are …

Originally appeared on The Epoch Times

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