Make Kitco Your Homepage

Omicron variant likely to usher growth downgrades -IMF's Georgieva

Kitco News

WASHINGTON, Dec 3 (Reuters) - Global economic growth projections from the International Monetary Fund will likely be downgraded due to the emergence of the Omicron variant of the coronavirus, IMF Managing Director Kristalina Georgieva said on Friday.

"A new variant that may spread very rapidly can dent confidence, and in that sense, we are likely to see some downgrades of our October projections for global growth," Georgieva said during the Reuters Next conference.

The IMF said in October it expected the global economy to grow 5.9% this year and 4.9% next year, pointing then to the threat of new coronavirus variants as increasing uncertainty about the timeline for overcoming the pandemic.

INFLATION BITES

Georgieva said high inflation in the United States should be addressed by policymakers but that such hefty price pressures are not being observed equally around the world, allowing other economies to change policy at their own pace.

The IMF's head added that the strength of the U.S. economy has a positive spillover effect around the world even if it means the U.S. Federal Reserve will wind down its accommodative policy stance in the months ahead, as most economists now expect.

Georgieva said tariff reductions are a "useful tool" to help control inflation and that she was encouraged by U.S. Trade Representative Katherine Tai's work on tariff reductions through an exclusion process.

"It is not a silver bullet. There has to be action on all these fronts, so we can see the issue of inflation being contained."

To watch the Reuters Next conference please register here https://reutersevents.com/events/next/

Reporting by David Lawder, Daniel Burns and Rodrigo Campos; Editing by Sonya Hepinstall and Cynthia Osterman

Our Standards: Th

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.