IMF Warns Slower Disinflation Risks Higher Rates for ‘Even Longer’
- 2025 growth estimate raised to 3.3%, this year stays at 3.2%
- Powell says this week recent data ‘add somewhat to confidence’
Despite those warning, the IMF sees the global economy still poised for a soft landing.
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The International Monetary Fund warned that inflation in many major economies has been cooling slower than expected, flagging a potential risk to global growth from interest rates staying higher “for even longer.”
The Washington-based lender, in an update to its flagship World Economic Outlook released Tuesday, zeroed in on stubborn services inflation, mainly driven by higher wages. It also pointed to price pressures from trade and geopolitical tensions, particularly on commodities like oil.