IMF Cautions Global Economic Uncertainty to Persist as “New Normal”
(MENAFN) International Monetary Fund (IMF) Managing Director Kristalina Georgieva cautioned Wednesday that ongoing uncertainty in the global economy is likely to persist as the “new normal.” Speaking at the Milken Institute in Washington, D.C., she stressed that while the world economy is “better than feared, but worse than we need,” significant challenges remain ahead.
“Global resilience has not yet been fully tested. And there are worrying signs the test may come,” Georgieva said, highlighting rising risks on the horizon.
She pointed to tariff policies as a crucial factor shaping the future of the global economy, warning that their full impact “is still to unfold.” Additionally, Georgieva expressed concern that redirected goods, initially intended for the U.S. market but rerouted elsewhere, could spark a “second round of tariff hikes.”
Despite current financial market stability, she cautioned that this may mask underlying policy turmoil. “If a sharp correction were to occur, tighter financial conditions could drag down world growth,” Georgieva added.
The IMF chief urged policymakers worldwide to protect trade as a vital driver of economic expansion. “Let's pull together in this complex world to deliver smart policies that build strong markets, institutions, and safety nets,” she said.
In its latest World Economic Outlook update, the IMF downgraded global GDP growth for 2025 to 3 percent from the previous 3.3 percent projection made in 2024. The IMF plans to release updated forecasts during its annual meetings in Washington, D.C., scheduled for October 13-18.
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