IMF Warns of Possible ‘Spiral’ of Waning Growth, Escalating Debt
- Global debt rising as emerging markets struggle, IMF says
- Spending cuts could set off cycle, fund's fiscal chief says
What Threats Are There to Global Financial Stability?
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Global policy makers need to guard against a self-reinforcing “spiral” of weakening growth and rising debt that could require a coordinated response by the world’s major economies, according to the IMF’s top fiscal watchdog.
Most countries are on a higher debt path than they were a year ago, the International Monetary Fund said in its semi-annual Fiscal Monitor report released Wednesday. Fiscal deficits in 2015-2016 in emerging economies are projected to exceed levels during the global financial crisis, as countries struggle with low oil prices, cooling investor sentiment and intensifying geopolitical tensions.